Indian stock markets have seen recent corrections, but global equity strategist Chris Wood of Jefferies believes the tide will soon turn. Speaking at the Business Standard Manthan Summit in New Delhi, Wood expressed his long-term bullish stance on Indian equities, predicting a potential 10-15% rise in frontline indices like Sensex and Nifty over the next 12 months.
FII Outflows: A Temporary Roadblock?
Despite his optimistic outlook, Wood acknowledged the significant Foreign Institutional Investor (FII) outflows, which have led to market weakness. Foreign investors have reportedly offloaded over ₹1 trillion worth of Indian stocks in the last year, raising concerns about valuations. However, Wood remains confident, stating that the current phase of selling may be linked to temporary factors, including:
A shift in investor interest toward cheaper Chinese markets.
A reaction to recent news surrounding the Chinese AI firm DeepSeek, which has bolstered confidence in China’s technology sector.
Wood believes that once FIIs stabilize their investments, Indian markets will witness a strong rally. “If someone has no exposure to Indian stocks, they should start buying now. When the tide turns, the rally would be very sharp,”
he advised.
Supercycle in Tourism and Domestic Demand
Beyond stock markets, Wood highlighted India’s booming tourism sector and domestic consumption as key economic drivers. With increasing travel and infrastructure development, he sees strong long-term potential for India's economy.
He also pointed out that the government’s focus on boosting local manufacturing, along with rising consumer spending, will create a favorable environment for sustained market growth.
The Role of Gold and US-China Tensions
Chris Wood also discussed the rising appeal of gold, which has recently gained traction as a safe-haven asset. Factors such as Russia’s restrictions on selling reserves and global economic uncertainty have pushed gold prices higher. Wood expects further appreciation in gold, with potential prices reaching $1,500 per ounce in the long run.
On geopolitical matters, Wood highlighted the ongoing tensions between the US and China. He noted that despite economic normalization efforts, trade restrictions remain a challenge. A key factor in the coming months will be how the US Federal Reserve handles its rate-cutting cycle, which could impact global markets, including India.
While FII selling has pressured Indian markets, experts like Chris Wood believe the long-term story remains intact. With strong domestic consumption, a booming tourism industry, and resilient economic fundamentals, India is poised for a sharp rally once global investors regain confidence.
For investors looking at long-term opportunities, this could be the ideal time to enter the market and capitalize on future gains.
Disclaimer:
The information provided in this article is for informational and educational purposes only and should not be considered as financial advice. Stock market investments are subject to market risks, and readers are advised to conduct their own research or consult with a financial advisor before making any investment decisions. The views expressed by Chris Wood are his own and do not necessarily reflect the opinions of SensexNifty.com or its authors.
