For emerging market investors, Indian equities had been in the ascendancy again this year, prior to general election results this week that showed surprise weakness for Narendra Modi's BJP. The MSCI India index was sitting on an impressive 13.3 per cent year-to-date sterling total return as of early June, putting it ahead of even the S&P 500 and a resurgent FTSE 100, before sliding 6 per cent on 4 June as results suggested the BJP had lost its parliamentary majority.
Nonetheless, India's stock market success over the past half decade has made it increasingly hard to ignore, with it making up 18.5 per cent of the iShares MSCI Emerging Markets ETF (IEEM) and plenty of Asian and emerging market equity managers increasingly embracing the region. But in 2024 the most prominent country in this investment universe has quietly staged something of a comeback that could turn heads – whether or not the shine has now come off Indian investments.
Having been the problem child of emerging markets for the past few years, China has offered investors some reason for optimism in 2024.