CLSA reverses its investment shift from India to China, citing economic concerns in China, trade tensions, and rising U.S. yields. It increases India exposure, despite risks like market issuance surge.

CLSA said it committed funds at the start of October by tactically deploying some of its over exposure on India to China. It has now reversed that trade, Both MSCI China and India have corrected by 10 per cent in US dollar terms over the duration.

Turning ‘overweight’ essentially means Indian equities should perform better compared with other markets. The reversal is also attributed to an escalation of a trade war between US and China with Trump proposing up to 60 per cent tariff on Chinese imports into the US during his Presidential campaign and an underwhelming stimulus package by the Chinese government.