CLSA has increased its investment in Indian stocks while decreasing its investment in Chinese stocks. This decision comes after a period of optimism about the Chinese market, which has since faded due to concerns about trade tensions with the US and a lack of significant economic stimulus from Beijing.

Read why has CLSA reversed its allocation strategy, raising investment in Indian equities while cutting China exposure.

CLSA had reduced its Indian overweight to 10 per cent from 20 per cent and raising our China allocation to a 5 per cent overweight from the benchmark.

In just over a week since Donald Trump won the US Presidency, Hong Kong-based brokerage firm CLSA raised its India allocation to a 20 per cent overweight, while cutting exposure to China. This is seen as a tactical reversal from its early October update when it went ‘overweight’ on China following Beijing’s first stimulus on September 24.

China's recent economic woes, including trade tensions with the US and falling property prices, will likely continue to weigh on the Chinese equity market, it believes. In contrast, India is seen as a more attractive investment destination due to its strong economic growth and relatively low exposure to trade risks, CLSA said in a note.

India is emerging as one of the least affected markets in the region when it comes to former U.S. President Donald Trump's trade policies, highlighted a report by global brokerage firm CLSA. The report stated that this resilience is attributed to India's relatively low trade exposure to the U.

CLSA has reversed earlier allocation, increasing India and cutting China, even as India faces sustained foreign investor outflows. It said several global investors have been waiting for a correction to re-enter the Indian markets.

CLSA has now positioned India as a 20% overweight in its portfolio, reflecting a more optimistic outlook for the country.

CLSA reverses trade over-exposure from India to China, citing India's resilience to trade policy and strong domestic ownership.

With Trumps win to US election 2024, higher yields and inflation expectations are sapping scope for Fed in rate cuts, and thus Peoples Bank of China (PBOC) is expected to ease its policy stance ahead.