Wall Street Touts India Options for Market Insulated From Trump
India's equity rally may have stuttered recently, but Wall Street banks are now doubling down on the world's fifth-largest stock market, this time focusing on derivatives.
In notes last week, JPMorgan Chase & Co. called India a 'relative safe haven amid a trade war 2.0,' recommending bullish option strategies. Meanwhile, Bank of America Corp. offered low-cost hedges to help investors 'more confidently stick to their core long positions.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
43 minutes ago
- Bloomberg
Apple Event to Put Focus on ‘Existential Risk' of AI Struggles
Apple Inc. shares have been heavily tethered to US trade policies this year, but its annual developer's conference could refocus Wall Street's attention on a potentially bigger problem: its struggles with artificial intelligence. The iPhone maker's WWDC event kicks off Monday and isn't expected to feature much in the way of major AI releases. That could shine a light on Apple's shortfalls with the critical technology, threatening further weakness for its shares with few obvious catalysts on the horizon to turn things around.
Yahoo
an hour ago
- Yahoo
India central bank's large rate cut squeezes forward premiums, leaves rupee vulnerable, analysts say
By Nimesh Vora and Jaspreet Kalra MUMBAI (Reuters) -The Reserve Bank of India's surprise outsized rate cut last week will leave the rupee vulnerable to further depreciation by pressuring already depressed foreign exchange forward premiums, several analysts said on Monday. The rupee has underperformed its Asian peers in 2025 amid weak capital flows. A narrowing interest rate differential — with the U.S. Federal Reserve moving slower than the RBI in cutting rates — suggests the Indian currency may continue to lag. MARKET REACTION The 1-month U.S. dollar/rupee forward premium — typically more sensitive to liquidity conditions — fell to 7.5 paisa, its lowest level since November. Meanwhile, the 1-year premium, which is more responsive to rate differential between the U.S. and India, declined to 1.5250 rupees, marking its lowest level in nearly a year. GRAPHIC: WHY IT'S IMPORTANT A drop in dollar/rupee forward premiums makes the rupee less attractive for carry trades, and diminishes the incentive for exporters to hedge future receivables. At the same time, it raises the likelihood that importers—who typically hedge near-term payment obligations—will step up their hedging activity. The decline in premiums - a less favourable rate differential between the U.S. and India - could leave the rupee open to sharper depreciation. CONTEXT Against the backdrop of benign inflation and the need to support growth, the Reserve Bank of India last Friday delivered a larger-than-expected 50 basis point rate (bps) cut, exceeding the 25 bps anticipated by economists. In a further easing move, the central bank slashed the cash reserve ratio for banks. KEY QUOTES "One thing the rupee had going for it is that it offered attractive carry ... with the 50-bps rate cut from the RBI, carry attraction has been reduced," Mitul Kotecha, head of FX and EM macro strategy Asia at Barclays, adding that in an environment where investors are again focussed on carry, the rupee's appeal has been diminished. Falling premiums can be a "mild added headwind" for the rupee amid globally elevated yields, Dhiraj Nim, FX strategist at ANZ Research, said, and pointed out that if India growth data weaken, there could be scope for one more rate cut.
Bloomberg
an hour ago
- Bloomberg
Japan Should Use Asia Trade Bloc in US Talks, Party Chief Says
Japan should take a bigger role in a regional free trade agreement and use its expansion as a bargaining tool in tariff negotiations with the US, the leader of the country's largest opposition party said on Monday. Yoshihiko Noda, president of the Constitutional Democratic Party of Japan, was speaking to reporters in Tokyo after the country's chief negotiator returned from a fifth round of talks in Washington with little sign of a reprieve from US tariffs.
