‘India's one of the most crowded trades for FIIs’

With the US Federal Reserve's (Fed's) meeting outcome now known, all eyes are on the Reserve Bank of India to cut rates. Puneet Wadhwa caught up with SANDEEP BHATIA, managing director and head of equity India at Macquarie Capital in Mumbai, to discuss his views on the road ahead for global equity markets. There is a notable shift in global perception of India, he said, as it is now seen as a rising star, reflecting growing international admiration. Edited excerpts:

- SANDEEP BHATIA

The next big global event after the Fed's rate stance is the US election outcome. How are the markets preparing for it?

The US elections are very tightly poised. What once appeared to be an easy win for the Republicans shifted with the announcement of a new candidate. In the short term, both candidates are promising significant increases in spending without corresponding tax policies, which might initially boost the global economy and US markets. However, the US has been running a high fiscal deficit of around 6 per cent despite strong macroeconomic tailwinds over the past eight years. In the longer term, these increased expenditures could have negative repercussions for both US and global financial markets.

Is the Indian stock market ripe for a sharp correction?