Here's Why India ETFs Are Breaking Out...

India’s markets and India ETFs are turning around as strengthening corporate profits and its insulation from global trade war concerns helped lift this emerging market.

The iShares MSCI India ETF (CBOE: INDA), the largest India country-specific ETF, increased 4.5% over the past month and is now trading back above its long-term trend line at the 200-day simple moving average.

Indian shares are also trading toward all-time highs, with the widely followed S&P BSE Sensex hitting back-to-back records, the Wall Street Journal reports. The Indian index is among the best performing major benchmarks in the Asia-Pacific region.

Analysts argued that the booming Indian economy is supporting the growth, even as neighboring China reveals sings of slowing. With a strengthening domestic economy, market watchers believe the strong fundamentals will translate into improving corporate earnings and higher share prices.

MSCI’s India index

Ben Luk, a global macro strategist at State Street Global Markets, argued that per-share earnings for companies in MSCI’s India index should rise 28% in 2018, compared to the roughly 15% growth for emerging markets in Asia as a whole.

Indians are also putting millions of dollars back into their local stock markets for the first time, supporting stock prices even as foreign buyers grew more risk-off. Locals funneled $800 million in to the India’s equity market this month while foreigners sold off $44 million.