J.P.Morgan has downgraded Indian shares to "neutral" from "overweight", citing strain in balance of payments, while upgrading China shares to "neutral" from "underweight".The brokerage adds it is late in downgrading India, but if the rupee continues to slide it would continue to under perform.
The rupee slumped to a record low to 64.13 in early trade on Tuesday and bond yields hit another five-year high as India the third-largest economy of Asia bore the brunt of rising money outflows .
Nomura credit analyst Pradeep Mohinani said, "India's problems are nowhere near resolution because New Delhi has not done anything - there is no focus on improving productivity, infrastructure or getting FDI back,".