Emerging market sells offs and have been blamed ( and rightly so ) for the sudden falls of our dear Index. The MSCI EMI has been a great indicator of the general movements in the EMs and the correlation the NIFTY inspite of India weightage at 8.42% has been visible
But is it now possible that for some time , the major weightage EMs in the MCSI EMI now delink ? I think so .
The Table below shows the performance of MSCI EM Vs the Major weightage Country Indices ( Weightage :China 26.37% , South Korea 14 .27% , Taiwan 12.28%, India 8.42%, Brazil 8.35%, Others 30.3%)
India has been a laggard , trailing Korea inspite of being the fastest growing economy in terms of growth rates. The clip below shows the graphs of each. Coupled with the US dollar rally and taking a view that the Dollar rally may be in the last legs , The NIFTY seems to have limited downside over the next 5 to 6 months , before reaching back to a number close to 8450 on the NIFTY.
I would be a Buyer( at least 40% to 50% ) the at current levels , keeping a plan to increase positions at 7600 and below.