The rally in Indian stocks that’s driven the benchmark index toward its record will falter as higher interest rates curb economic growth, according to Prudential International Investments Advisers LLC.
John Praveen , the Newark, New Jersey-based chief investment strategist at Prudential International Investments Advisers LLC, which oversees $750 billion in assets, comments on his outlook for Indian stocks. Prudential is a money manager in India through its local unit, Pramerica Asset Managers Pvt. Praveen gave his comments in an e- mail interview.
Large investors led by the Life Insurance Corp. of India, and executives at the biggest Indian companies are selling the most shares since 2010 just as foreigners plow record funds into the nation’s equity market.
Indian stocks may gain 10 percent by the end of this year, extending the longest rally since 1979, as an unscheduled rate increase by the central bank won’t derail economic growth, Prudential Financial Inc. said.
Meyer Shields says earnings at Warren Buffett’s Berkshire Hathaway Inc. will increase the most since 2006 this year. He’s also telling investors to sell the shares because the economic recovery is weakening.
U.S. stocks tumbled, with benchmark indexes slumping the most since February, as concern grew that Europe’s government debt crisis will spread beyond Greece. The euro slid below $1.30 for the first time in more than a year.
Indian companies’ American depositary receipts rose for a second day as speculation the government will reduce the deficit and curb inflation with its annual spending plan offset a surge in oil prices.
Auto companies, clothing retailers and appliance makers are posting the fastest profit growth in emerging markets, fueling a rally in developing-nation consumer shares after they fell to the cheapest level in three years.
Stocks in Europe dropped, U.S. shares swung between gains and losses and Irish bonds slumped after Moody’s Investors Service downgraded Ireland’s credit rating. Copper and oil rose following improving economic data.