HSBC downgrades India to ‘underweight’ as oil shock clouds earnings recovery
HSBC said that although domestic equity valuations have corrected from their peaks, they may appear expensive again as earnings downgrades filter through. (Representational image)
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HSBC downgraded Indian equities to “underweight” from “neutral” – its second cut in less than a month – as it expects surging energy prices triggered by the Middle East war to threaten the durability of the country’s earnings recovery. Brent crude is up 42% since the war started in late February and is currently trading above $100 a barrel, raising inflation and growth risks for the world’s third-largest oil importer.
“India now looks less attractive than North East Asian peers in the current macro setting,” HSBC said in a note on Thursday, with the benchmark Nifty 50 and Sensex falling 6.7% and 7.9% so far this year – among the worst performing markets globally.
Published – April 23, 2026 10:07 pm IST
