John Stoltzfus, Chief Investment Strategist at Oppenheimer Asset Management, highlights that there is ample room for increased investment in India and other emerging markets (EMs), presenting significant opportunities for investors willing to navigate the challenges these markets face.
Stoltzfus discussed the recent 25 basis point rate cut by the US Federal Reserve, noting that it fell short of market expectations, with traders hoping for more aggressive cuts. While the Fed has been focused on controlling inflation, this cautious approach to rate cuts has led to continued frustration, especially after hints of limited cuts for 2024.
Despite the elevated interest rates in the US, which have made US assets more attractive and drawn capital away from EMs, Stoltzfus sees continued interest from private investors in short and mid-term debt, while institutions are more focused on short-term securities.
A significant challenge for emerging markets remains the strong US dollar, which erodes foreign investment returns when converted. Additionally, it impacts dividends and interest payments. Stoltzfus suggests that emerging markets will remain under pressure until the dollar weakens, but he also pointed to growing interest in India, where exposure to the market has been steadily increasing over the past year.
Follow Us
