When it comes to the U.S. market, the more likely trigger for a correction could be a repeat of the 2011 debt-ceiling crisis rather than geopolitical uncertainties, Geoff Lewis, senior strategist (Asia) for capital markets at Manulife Asset Management, told BloombergQuint.
Rising tensions between the U.S. and North Korea has been fairly dealt with by the markets so far and the only thing investors can do is “put it to one side”, he said.
If there was to be a sharp correction, it would be a buying opportunity assuming some degree of rationality prevails in Pyongyang.Geoff Lewis, Senior Strategist (Asia) Capital Markets, Manulife Asset Management
Also Read: BQExplains: The North Korea Threat
“U.S. will receive more gift packages as long as it relies on reckless provocations,” said a North Korean diplomat on Tuesday responding to U.S. ambassador to the United Nations Nikki Haley's comment that Pyongyang was “begging for war”. Reports of a possible missile launch by North Korea before Saturday have also been doing the rounds.
The equity markets, however, have stayed relatively sanguine to the developments.
Also Read: Look At South Korean Market To Assess The North Korea Threat, Says Mark Matthews
On the whole, Lewis said, it is encouraging that investors are concentrating more on the “good news from the global economy” and less on the “political distractions”.
On India's Growth Story
Lewis may be bullish on India in the long term, but prefers China and North-East Asia over the country in the short term, he said. His key reasons:
- A slowdown in India's gross domestic product to 5.7 percent in the first quarter.
- Manufacturing slowdown.
- Earnings which have "not really performed as investors wished in the last few rounds".
Also Read: Is India's Home Finance Juggernaut Slowing?
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