The largest US-listed exchange-traded funds tracking single Asian countries from India to Taiwan suffered record outflows in March, just ahead of a massive rebound in the region's equities on the first day of April.
Traders yanked a record $1.4 billion in March from BlackRock's $6.7 billion iShares MSCI India ETF, known by its ticker INDA, according to data compiled by Bloomberg. The firm's $7 billion iShares MSCI Taiwan ETF, or EWT, also saw a record redemption of $1.1 billion last month, the data show.
The withdrawals point to growing strain across energy-centric Asia, with India hit by currency weakness, rising yields and profit concerns, and as Taiwan's export-heavy manufacturing base faced rising cost pressures. Still, Asian stocks jumped the most in nearly a year on Wednesday after President Donald Trump suggested he's keen to exit the Middle East conflict sooner rather than later, underscoring how quickly sentiment can shift with each turn in the war.
Photo Credit: Bloomberg
“I'd say this is a greed rebound on new hope for a shorter conflict than what was being priced in a few days ago,” said Ed Goard, chief investment officer of Yousif Capital Management, who holds INDA for clients. “But during times like these, markets overreact to headlines.”
Trump said Wednesday he'll only consider a halt to attacks on Iran when the Strait of Hormuz is reopened. In response, the Islamic Revolutionary Guard Corps said Hormuz won't be opened based on the “absurd displays of the American president,” according to state-run IRIB.
Stock gauges from both India and Taiwan are still down sharply since before the start of the war.
Bad Start
For India, a bad start to the year for the country's locally-listed stocks turned worse following escalating tensions in the Middle East, with investors concerned about the impact of the global energy crisis on its economy.
The country's stock benchmark lost 11% in March, taking losses for the year to over 15% and making it among the worst performing countries in Asia in 2026. With the rupee hitting record lows against the dollar and government bond yields rising, worries are growing that the country's underperformance to its emerging-market peers could deepen.
UBS Global Wealth Management and HSBC downgraded Indian equities to neutral in recent days citing risks from the war.
And in Taiwan, the energy crisis has weighed on the outlook for its chip sector, given that the country is heavily dependent on natural gas imports to run its power plants. The country's benchmark equities index fell nearly 13% in March, the most since September 2022.
“Taiwan does have advantages over some other smaller Asian countries given they dominate in tech and semiconductors, and this gives them some pricing power to a degree,” Goard said.
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