U.S. Markets Must Stabilise For India To Do Well, Says Samir Arora
India and other emerging market peers will perform better this year only if the U.S. market stabilises, according to Samir Arora, fund manager at Helios Capital.
“There could be volatility in short-term if the U.S. witnesses violent move,” Arora told BloombergQuint in an interaction. “The Indian markets will outperform even if the U.S. markets fall 5-10 percent. But there will be no positive returns.”
This comes at a time the U.S. markets traded volatile last week. The S&P 500 Index moved more than 1 percent in 11 trading sessions since December.
Arora was also bullish on the private sector financials. “The private sector has been our number one theme over the last 15-18 years,” he said, adding that the company has taken fresh bets on two corporate banks. “Banks have been taking huge bets and have failed. In the recent times, however, they have come down and that would improve their asset quality.”
But the market veteran reduced the share of non-bank lenders in his portfolio to 6-7 percent from 15 percent after the liquidity crisis triggered by payment defaults at IL&FS and its subsidiaries threatened a contagion in financial markets.
“We are not sure how markets will react to the NBFC sector. We expect that the sector will take some time for readjustment,” Arora said.