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Indian stock markets are the most favoured by fund managers in India, BofA survey showsA net 42% of fund managers surveyed by Bank of America (BofA) preferred India over other regional markets, placing it ahead of Japan (39%), China (6%), and Singapore (3%).By Yoosef K   May 14, 2025, 2:02:58 PM IST (Published)3 Min ReadAfter slipping to the second-least favoured stock market in Asia, fund managers in Asia have once again turn optimistic on India given supply chain-related changes amid global trade tensions. The fifth largest equity market has now displaced Japan as most Favored Asian Market. The revival in confidence is interesting considering the country had slipped to the second-least favoured stock market in Asia in February this year.

A net 42% of fund managers surveyed by Bank of America (BofA) preferred India over other regional markets, placing it ahead of Japan (39%), China (6%), and Singapore (3%). “India emerges as the most favored market, perceived as a likely beneficiary of supply chain realignments following the effects of tariffs,” BofA Securities stated in its latest fund managers survey.

Interestingly, China climbed to the third spot from being the least favoured market in the previous month. Meanwhile, Thailand and Taiwan continue to rank as the least preferred markets among fund managers.

Japan, the second-largest Asian market after China, has lagged India in performance so far this year. While the benchmark Nifty50 has risen 4% since the beginning of the year, Japan’s Nikkei 225 has declined by 4.4% over the same period.

The survey further reveals that infrastructure and consumption remain the dominant investment themes in India that fund managers are closely tracking. Additionally, sentiment toward China has improved notably, with the country climbing to the third spot from its position at the bottom just a month ago, according to the survey conducted earlier this month.

In the Asia ex-Japan portfolio, fund managers remain overweight on telecom and software sectors, while underweighting energy, materials, and consumer discretionary e-commerce. Notably, sentiment toward semiconductors has improved since April. According to BofA, the share of participants expecting a downturn in the semiconductor cycle has declined to a net 42%, down from 59% last month.

According to the survey, a turnaround in the economic growth outlook has boosted market return expectations across the Asia-Pacific region. While a net 58% of fund managers still expect an earnings slowdown, this marks a notable improvement from 78% in the previous month. Additionally, consensus earnings estimates are not seen as overly stretched compared to last month, suggesting there is room for upward revisions going forward.

A total of 208 panelists, collectively managing $522 billion in assets, participated in the survey, according to BofA Securities. Of these, 174 panelists with $458 billion in assets under management (AUM) responded to the global Fund Manager Survey (FMS) questions, while 109 panelists overseeing $234 billion in AUM took part in the regional FMS section conducted between May 2 and May 8, 2025.Continue ReadingCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!Tagsindian stock marketJapanshare market today