Emerging market investing guru Mark Mobius said he likes Indian stocks even though Covid-19 cases in the country have risen sharply as “this is going to happen”.
India’s Nifty 50 equity benchmark was up 8.1% at close of trading on Tuesday. The index has risen despite the country reporting a resurgence of Covid infections last month.
The South Asian country was one of Mobius’ favorite markets even before the pandemic. The investor, founding partner of Mobius Capital Partners, said it was “quite astonishing” that the Covid crisis in India did not materially affect the stock market.
“But in general we know that this will happen, that people will be vaccinated and the number of (Covid cases) will decrease,” Mobius told CNBC’s “Capital Connection” on Tuesday.
“And given that, it’s probably a good opportunity to buy,” he added.
On the Indian Stock Exchange, Mobius said he likes software companies, healthcare stocks, and companies that provide equipment and materials for infrastructure projects.
Goods and cryptos
On the commodities side, Mobius said he continues to like gold. He added that he prefers to hold physical gold rather than buying mining companies, many of which are “not as profitable”.
But the veteran investor said he was “not that excited” about the oil sector. That’s because oil prices had an “incredible run” as they recovered from the crash of the pandemic and may not continue to rise, he said.
“I think we’re probably where we should be, $ 60 to $ 70 a barrel, so we won’t see an incredible boom in oil companies,” Mobius said, adding that some companies may still be interesting even though he is unspecified which.
Another investment that Mobius doesn’t like is cryptocurrency, which he describes as “very risky territory”.
The price of Bitcoin rose from under $ 30,000 at the end of 2020 to over $ 43,000 on Wednesday.
Mobius said it was difficult to predict the direction of cryptocurrency prices and wondered how easy it would be to convert Bitcoin and other cryptocurrencies into “real money” for people to spend. He also disagreed with suggestions that Bitcoin could replace gold as a hedge against inflation.
“I can’t have a crypto-ring while I can have a gold ring – that’s the real difference,” Mobius said.
“It’s a completely different situation and I don’t know why people say Bitcoin can be like gold, it’s completely different. Gold is gold and it’s something physical while Bitcoin isn’t.”