Falling global interest rates and the promise of respite in long-running Sino-U.S trade tensions are luring investors seeking decent yields to emerging Asian bonds.
Foreign investors turned net buyers of Asian stocks in June as optimism ahead of a meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping, along with expectations of U.S. interest rate cuts bolstered sentiment.
As domestic economic concerns overtake last month's national election euphoria, India's stock market rally has lost steam and the index is lagging its Asian peers.
BENGALURU India's blue-chip shares are vastly outperforming those of smaller companies as investors avoid risky bets in a slowing economy, with the gap between the two groups at its widest in more than a decade.
(Corrects company name in fifth paragraph to BNP Paribas Asset Management, from BNP Paribas)
While overseas investors sold Asian equities in May, they bought the region's bonds, which were made more attractive by falling yields and offered some safety amid worries over the Sino-U.S. trade war, Brexit and a global economic slowdown.
Asian equity markets saw heavy outflows in May as a sudden escalation in the U.S.-China trade war threatened to put more pressure on export-reliant regional economies and companies which are highly reliant on Chinese sales.
Overseas investments into Asian bonds turned negative for the first time in three months in April, and analysts predicted the regional assets to come under more pressure due to an escalation in the Sino-U.S. trade dispute.
May 10 Foreigners were net buyers of Asian
equities for the fourth straight month in April, but analysts
doubt such inflows could be sustained amid an escalating tariff
war between the world's top two economies.
Foreigners were net buyers of Asian equities for the fourth straight month in April, but analysts doubt such inflows could be sustained amid an escalating tariff war between the world's top two economies.