Here’s Why India ETFs Are Soaring This Year

April 22, 2017 7:39am BATS:INDA

india-flag

Terry Ruffolo and Neena Mishra of Zacks Research discuss the huge upturn in India ETFs this year, driven by strong performance of Indian stocks as well as emerging markets in general.


Emerging market ETFs are surging in 2017 and within that space, India ETFs are the best performers. Foreign investors continue to pour money into Indian stocks as optimism about economic growth and structural reforms continues to rise.

Since his election in 2014, Prime Minister Modi’s government has pushed through a lot of reforms in India. Foreign investors continue to believe that he will be able to take necessary actions to promote foreign investments, revamp tax system, promote infrastructure and reduce corruption.

Modi’s party recently had a big victory in an important state election, which suggests that he’ll most likely win second term in office in the next general elections.

Per IMF, the Indian economy will grow at 7.2% in 2017 and 7.7% in 2018, making it the fastest growing major economy in the world.

For US tech giants, India is a very important market and they’re betting big on growth prospects in the country.

Apple (AAPLFree Report) is expected to start manufacturing iPhones in India within the next 1-2 months. It is an important market for them since sales in China are slowing down. India is now the second largest smartphone market in the world.

Amazon (AMZNFree Report) is investing $5 billion in India. Facebook (FBFree Report) and Google-Alphabet (GOOGL) compete with each other to provide connectivity to Indians that have no internet access as of now.

With a population exceeding 1.2 billion, India has the potential to become the largest open internet market in the world.

Uber is aggressively expanding in India, after retreating from China last year.

To learn more about three popular India ETFs—theiShares MSCI India ETF (INDAFree Report) , WisdomTree India Earnings Fund (EPI) and the Van Eck India Small-Cap Index ETF (SCIFFree Report) , please watch the short video above.

The iShares MSCI India ETF (BATS:INDA) closed at $31.13 on Friday, down $-0.35 (-1.11%). Year-to-date, INDA has gained 16.11%, versus a 4.95% rise in the benchmark S&P 500 index during the same period.

INDA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 77 ETFs in the Asia Pacific Equities Ex-China ETFs category.


This article is brought to you courtesy of Zacks Research.


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