Nomura upgrades India to 'overweight' after Nirmala Sitharaman announces a slew of measures to stimulate growth

After cutting its Nifty target to 11,800 for March 2020 last week, global brokerage Nomura upgraded India to 'overweight' after Finance Minister Nirmala Sitharaman announced a slew of measures to stimulate growth on Friday.According to Nomura, the upgrade on India is amid positive local developments amid rising global uncertainty. Indian market with less than average leverage to global growth could do relatively better, Nomura explained, according to CNBC-TV18.Giving in to the demands of overseas investors, Sitharaman on Friday announced a rollback of enhanced surcharge on foreign portfolio investors levied in the Budget.[caption id="attachment_329467" align="alignleft" width="380"] Representational image. Reuters[/caption]The Budget proposal to hike surcharge on FPIs had spooked foreign investors, who withdrew more than $3.4 billion (Rs 24,500 crore) from domestic equities in July and August. The massive capital outflows also put pressure on the rupee, which slumped to 72-level against the US dollar last week."Withdrawal of enhanced surcharge on FPI is a big positive for Indian markets as it could reverse the outflows seen since post Budget. It should also help INR appreciation. Overall, a good sentiment booster for the Indian economy," said Rusmik Oza, Head of Fundamental Research, Kotak Securities, told PTI.Nomura cut its Nifty target for March 2020 to 11,800 last Thursday. “While we acknowledge a challenging growth environment, the consensus narrative has turned pessimistic in a dramatic fashion since FY20 budget day. Negative feedback loop from sharp correction in stock prices has a role to play and is impacting the fundamental view (reflexivity), which has not changed materially over the past one month,” wrote Vinod Karki of ICICI Securities in a co-authored report with Ravin Kurwa, according to a report in The Business Standard.