Latest news with #ManishBhargava
Economic Times
25-07-2025
- Business
- Economic Times
Resurgence of India rate-cut wagers revives foreign investor interest in bonds
Foreign investors are showing renewed interest in Indian government bonds, driven by expectations of an upcoming rate cut by the Reserve Bank of India as early as August. Subdued inflation and persistent growth concerns are fueling these expectations. Over the past month, foreign investors have net purchased 129 billion rupees in Indian bonds. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Foreign appetite for Indian government bonds is back, with inflows picking up steadily over the last month, as investors gauge fresh expectations of a rate cut by the Reserve Bank of India as early as RBI cut rates by a larger-than-expected 50 basis points in June and changed the stance to "neutral", prompting investors to bet on a prolonged a sharp drop in June retail inflation has some investors reassessing the likelihood of another rate RBI could implement a modest 25 basis point cut in August if inflation remains subdued and growth concerns persist, said Singapore-based Manish Bhargava, CEO of Straits Investment Management, adding that bond yields are attractive at current the last one month, foreign investors have net bought 129 billion rupees ($1.5 billion) of Indian bonds linked to global indexes after selling more than 330 billion rupees in the first two-and-a-half months of the financial year that started on April 1, clearing house data said concerns on the growth front are also likely to prompt the central bank to lower rates recent high-frequency data disappointing and indicating the possibility of a further slowdown in growth, "there is potential for more support from the RBI further down the line," said London-based Giulia Pellegrini, lead portfolio manager, emerging market debt at overall economic fundamentals remain solid, keeping the country on investors' radar, she said.A wider gap between interest rates in India and the U.S. would add to the appeal of Indian debt, investors why a Federal Reserve rate cut could act as a positive catalyst for Indian bonds, as they have historically helped local currency debt markets, said Nigel Foo, Singapore-based head of Asian fixed income at First Sentier current Indian bond yields are lower than where they were in the past at similar policy rate levels, and so are relatively unattractive, he 10-year U.S. yield was around 4.35%, with the Fed expected to cut rates by at least 50 bps in 2025. The Indian 10-year benchmark bond yield was at 6.30%."India's local debt story remains very compelling on both FX and rates," said Jean‑Charles Sambor, head of emerging markets debt at TT International Asset Management in London, who expects bond yields to decline through this year and next, and finds the middle of the yield curve attractive.($1 = 86.2470 Indian rupees)
Business Times
20-06-2025
- Business
- Business Times
Thai stocks may fall to Covid lows amid political crisis: analyst
[SINGAPORE] Thailand's stock market cannot catch a break – the fallout from a major political crisis may further rock the worst-performing market in the world this year. Amid the existing headwinds from tariff uncertainty and the faltering tourism revenue, the Stock Exchange of Thailand's (SET) benchmark index has already wilted 23.8 per cent since the start of the year as at Friday (Jun 20), placing it last among all global equity indices, according to Bloomberg data. The market sell-off intensified in recent days as political jitters flared, following a leaked phone call between officials in Bangkok and Phnom Penh which heightened tensions along the Cambodian border. With economic headwinds already pressuring sentiment, analysts warn the bloodbath on the bourse may not yet be over. 'If foreign fund outflows accelerate and the prime minister faces calls to resign or a no-confidence vote, the SET Index could test 2020 Covid lows,' said Manish Bhargava, chief executive at Straits Investment Management. The index had fallen to a low of 969.1 points in March 2020, a level not seen since late-2011. Thailand's stock exchange was the worst-performing bourse in Asean on Thursday, with the SET Index plunging 2.4 per cent to 1068.7 – its sharpest drop this year – after the call was leaked on Wednesday. While other regional markets also posted losses, they did not match the scale of the Thai sell-off, underscoring growing investor unease as the kingdom faces domestic instability and macro headwinds. The losses came as a leaked phone call between Thai Prime Minister Paetongtarn Shinawatra and former Cambodian prime minister Hun Sen on Wednesday incited the Bhumjaithai Party (BJT) to announce its exit from the ruling coalition government. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up BJT's withdrawal leaves the ruling coalition, led by Paetongtarn's Pheu Thai Party, with a slim majority by just 18 seats. As calls for her resignation escalate and other coalition partners threaten to withdraw, uncertainty has arisen over the possibility of a Cabinet reshuffle, or a snap election that may lead to a political stalemate. This could mean a three to six-month wait for a new government to take office, said CGS International (CGSI) analyst Kasem Prunratanamala in a note on Wednesday night. 'We believe that it would be difficult for the SET to perform during this period.' Bhargava noted: 'Key sectors that are sensitive to political stability – banks, infrastructure and utilities – will likely lead declines.' Others, however, remained optimistic. OCBC Asean economists Lavanya Venkateswaran and Jonathan Ng maintained a baseline scenario of the political situation staying contained in a note on Jun 18, citing Paetongtarn's reconciliatory tone. The SET Index closed lower on Friday at 1067.6 points, falling 0.1 per cent. Tourist slump A slump in tourist arrivals to Thailand has reverberated through its economy, with the sector accounting for around 12 per cent of gross domestic product and employing more than 20 per cent of workers in 2024, according to the Bank of Thailand (BOT). Foreign tourist arrivals to the country dipped 11 per cent in May from the previous month, continuing what has been a slow start to the year for the industry. The 14.3 million tourist arrivals during the first five months of 2025 were down 2.7 per cent from the previous corresponding period last year, and brought in 1.9 per cent less revenue at about 668.4 billion baht (S$26.2 billion), according to a Bank of America note. The bourse's tourism sector, comprising stocks including spa operator Siam Wellness Group and hotel operators Central Plaza Hotel and Erawan Group, has fallen about 23.4 per cent since the start of the year. But hopes of a sector-wide revival have also led some analysts to look with more optimism at stocks that have been battered hard by the slump. 'The tourism sector has already priced in the bad news,' UOB said in a Jun 5 note, naming stocks such as Erawan Group and mall operator Central Pattana as rebound plays. 'We expect tourist arrivals to recover in the third quarter of 2025,' said UOB analysts Kitpon Praipaisarnkit and Krit Tanarattananon. Yet while the tourism sector's dips may have bottomed out, CGSI analyst Thanapol Jiratanakij does not foresee a 'swift recovery' in arrivals – largely owing to the declining popularity of the nation among Chinese tourists. Increasing safety concerns from incidents such as the abduction of a Chinese actor in January and an earthquake in March have put off some Chinese nationals, who have turned towards domestic tourism and other regional alternatives for leisure travel. Existing headwinds to tourist arrivals have also hit the country's retail sector, highlighted by unlisted retailer King Power's request to terminate its duty-free concession contracts with Airports of Thailand. Maybank had earlier downgraded the broader retail sector to neutral, with companies such as department store operator Central Retail receiving 'hold' ratings. The bank cited sector-wide headwinds in muted consumption, falling tourist arrivals and a subdued economic outlook. 'Restoring confidence among Chinese tourists will require real improvements in safety and perception,' CGSI's Thanapol said. 'In this regard, we believe the government still has considerable work to do.' But as Paetongtarn's leadership remains uncertain, such efforts to boost the domestic economy may no longer be on the cards. 'The timing could not be more inconvenient considering (the) external headwinds,' said OCBC's Venkateswaran and Ng. As observers await the BOT's policy decision on Jun 25, ANZ Asia economist Krystal Tan expects the central bank to hold its benchmark rate at 1.75 per cent until the fourth quarter – but a worsening political gridlock may force the BOT into a rate cut. This may provide a catalyst to Thai stocks amid the wavering political situation, said CGSI's Kasem. He maintained the index's target at 1,200 points, citing its relative undervaluation to its peers.
Business Times
20-06-2025
- Business
- Business Times
Thai stocks may fall to Covid lows amid political crisis: analysts
[SINGAPORE] Thailand's stock market cannot catch a break – the fallout from a major political crisis may further rock the worst-performing market in the world this year. Amid the existing headwinds from tariff uncertainty and the faltering tourism revenue, the Stock Exchange of Thailand's (SET) benchmark index has already wilted 23.8 per cent since the start of the year as at Friday (Jun 20), placing it last among all global equity indices, according to Bloomberg data. The market sell-off intensified in recent days as political jitters flared, following a leaked phone call between officials in Bangkok and Phnom Penh which heightened tensions along the Cambodian border. With economic headwinds already pressuring sentiment, analysts warn the bloodbath on the bourse may not yet be over. 'If foreign fund outflows accelerate and the prime minister faces calls to resign or a no-confidence vote, the SET Index could test 2020 Covid lows,' said Manish Bhargava, chief executive at Straits Investment Management. The index had fallen to a low of 969.1 points in March 2020, a level not seen since late-2011. Thailand's stock exchange was the worst-performing bourse in Asean on Thursday, with the SET Index plunging 2.4 per cent to 1068.7 – its sharpest drop this year – after the call was leaked on Wednesday. While other regional markets also posted losses, they did not match the scale of the Thai sell-off, underscoring growing investor unease as the kingdom faces domestic instability and macro headwinds. The losses came as a leaked phone call between Thai Prime Minister Paetongtarn Shinawatra and former Cambodian prime minister Hun Sen on Wednesday incited the Bhumjaithai Party (BJT) to announce its exit from the ruling coalition government. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up BJT's withdrawal leaves the ruling coalition, led by Paetongtarn's Pheu Thai Party, with a slim majority by just 18 seats. As calls for her resignation escalate and other coalition partners threaten to withdraw, uncertainty has arisen over the possibility of a Cabinet reshuffle, or a snap election that may lead to a political stalemate. This could mean a three to six-month wait for a new government to take office, said CGS International (CGSI) analyst Kasem Prunratanamala in a note on Wednesday night. 'We believe that it would be difficult for the SET to perform during this period.' Bhargava noted: 'Key sectors that are sensitive to political stability – banks, infrastructure and utilities – will likely lead declines.' Others, however, remained optimistic. OCBC Asean economists Lavanya Venkateswaran and Jonathan Ng maintained a baseline scenario of the political situation staying contained in a note on Jun 18, citing Paetongtarn's reconciliatory tone. The SET Index closed lower on Friday at 1067.6 points, falling 0.1 per cent. Tourist slump A slump in tourist arrivals to Thailand has reverberated through its economy, with the sector accounting for around 12 per cent of gross domestic product and employing more than 20 per cent of workers in 2024, according to the Bank of Thailand (BOT). Foreign tourist arrivals to the country dipped 11 per cent in May from the previous month, continuing what has been a slow start to the year for the industry. The 14.3 million tourist arrivals during the first five months of 2025 were down 2.7 per cent from the previous corresponding period last year, and brought in 1.9 per cent less revenue at about 668.4 billion baht (S$26.2 billion), according to a Bank of America note. The bourse's tourism sector, comprising stocks including spa operator Siam Wellness Group and hotel operators Central Plaza Hotel and Erawan Group, has fallen about 23.4 per cent since the start of the year. But hopes of a sector-wide revival have also led some analysts to look with more optimism at stocks that have been battered hard by the slump. 'The tourism sector has already priced in the bad news,' UOB said in a Jun 5 note, naming stocks such as Erawan Group and mall operator Central Pattana as rebound plays. 'We expect tourist arrivals to recover in the third quarter of 2025,' said UOB analysts Kitpon Praipaisarnkit and Krit Tanarattananon. Yet while the tourism sector's dips may have bottomed out, CGSI analyst Thanapol Jiratanakij does not foresee a 'swift recovery' in arrivals – largely owing to the declining popularity of the nation among Chinese tourists. Increasing safety concerns from incidents such as the abduction of a Chinese actor in January and an earthquake in March have put off some Chinese nationals, who have turned towards domestic tourism and other regional alternatives for leisure travel. Existing headwinds to tourist arrivals have also hit the country's retail sector, highlighted by unlisted retailer King Power's request to terminate its duty-free concession contracts with Airports of Thailand. Maybank had earlier downgraded the broader retail sector to neutral, with companies such as department store operator Central Retail receiving 'hold' ratings. The bank cited sector-wide headwinds in muted consumption, falling tourist arrivals and a subdued economic outlook. 'Restoring confidence among Chinese tourists will require real improvements in safety and perception,' CGSI's Thanapol said. 'In this regard, we believe the government still has considerable work to do.' But as Paetongtarn's leadership remains uncertain, such efforts to boost the domestic economy may no longer be on the cards. 'The timing could not be more inconvenient considering (the) external headwinds,' said OCBC's Venkateswaran and Ng. As observers await the BOT's policy decision on Jun 25, ANZ Asia economist Krystal Tan expects the central bank to hold its benchmark rate at 1.75 per cent until the fourth quarter – but a worsening political gridlock may force the BOT into a rate cut. This may provide a catalyst to Thai stocks amid the wavering political situation, said CGSI's Kasem. He maintained the index's target at 1,200 points, citing its relative undervaluation to its peers.
Reuters
28-03-2025
- Business
- Reuters
Foreign ownership of India's global index bonds crosses 3 trillion rupees before rate cut
MUMBAI, March 28 (Reuters) - Foreign holdings of Indian government bonds that allow unfettered investment have risen to more than 3 trillion rupees ($35 billion) for the first time as investors stepped up purchases ahead of an anticipated interest rate cut in April. Foreign inflows might see a further rise amid "an aggressive rate cutting cycle on growth/trade headwinds and well-behaved inflation as well as a stable currency," said Sabrina Jacobs, senior client portfolio manager, emerging market fixed income at Pictet Asset Management. On April 9, the Reserve Bank of India (RBI) is expected to cut its policy rate for the second time since February. The overnight index swap markets have started pricing in far more aggressive rate cuts. Interest rate cuts would lead to a drop in bond yields, resulting in capital gains. With just one session to go before the fiscal year ends, foreigners have bought 124 billion rupees of bonds in the last two weeks of March, up from the 40 billion rupee purchase in the first two weeks, data showed. Most bonds under the Fully Accessible Route (FAR), which allows investments outside of capital-flow limits, are included in global bond indexes. Overseas holding of these notes has doubled in the last 14 months, with the ownership rising to nearly 7% as of March 27. The two-year and eight-year papers are most preferred, with foreign ownership at 15.3% and 14.7%, respectively. Meanwhile, Manish Bhargava, CEO of Straits Investment Management, sees a cumulative rate cut of 50-75 basis points this year. There has been an increase in inflows in bonds given the RBI is widely expected to cut rates by 25 basis points next month, he added. India's retail inflation had dropped to a seven-month low of 3.61% in February. ($1 = 85.6100 Indian rupees)
