EMerging Equity

by Christopher Gannatti, Associate Director of Research


As we approach the end of 2014, one of the year’s biggest stories has been the declining price of oil. On June 20, 2014, Brent was at nearly $115. On November 13, 2014, it fell below $78, a cumulative decline of over 32%.1

Through November 13, 2014, India’s equities, measured by the BSE Sensex, had appreciated more than 30%.2 That is in an environment where broad emerging market equities3 have been basically flat.

India: World’s Fourth-Largest Oil Consumer 4

The bottom line: India uses a lot of oil, but it has very limited oil resources. The country depends on oil imports for more than 70% of its oil needs.5

We believe that, as the price of oil falls, India’s economic growth prospects—and by extension, equity market performance—may improve.

Historical Study: 3-Month 20% Brent Oil Price Declines…

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