HSBC’s Williem Sels sees no US recession risk, stays positive on India, China, Singapore

HSBC Private Bank’s Global CIO, Williem Sels, said the firm remains overweight on US equities and sees continued momentum in the market, supported by stable growth expectations and earnings outlook. Speaking from Bengaluru at the end of a month-long client roadshow across Asia, Sels noted that most investors no longer expect a recession or stagflation.“We are looking for 1.8% gross domestic product (GDP) growth in the US and 11% earnings growth,” Sels said. He added that policy uncertainty now carries “two-way risks,” with some instances of adjustments following market pressure, which is seen as a positive by investors.
Sels advised against trying to time the market, emphasising the importance of long-term investing. “It is very dangerous to try to time the market… compounding is the eighth wonder of the world,” he said, highlighting the importance of building resilient, diversified portfolios to weather ongoing uncertainty.
Also Read | This $3 billion fund CIO sees a brighter second half for markets, picks sectors to watchIn Asia, HSBC is overweight on India, China, and Singapore, but with a different approach to each market. Valuations between India and China are very different, but ROE is very different as well, he said. Indian companies, according to Sels, tend to have higher returns on equity, while Chinese firms are working toward being more shareholder-friendly.

In China, HSBC prefers the technology sector and dividend-paying companies, noting that domestic demand remains a concern.In India, the focus is on industrials, healthcare, and financials. HSBC expects GDP growth of 6.7% this year and 6.2% next year, driven by consumer demand supported by easing inflation and potential rate cuts. “We expect one further interest rate cut,” Sels said. He added that HSBC prefers largecap Indian stocks, citing more attractive relative valuations compared to small caps.

Also Read | Krishna Sanghavi says India’s consumer story intact, new entrants a healthy sign

Sels also recommended portfolio diversification, especially for Indian investors with concentrated domestic exposure. “You don’t want to double up on the country risk,” he said, advising clients to diversify globally where possible.

While many investors are turning to Europe, HSBC maintains an overweight stance on the US, calling it an “out of consensus” view. “The earnings season in the US can be a trigger for companies to do better than expectations,” Sels said, suggesting that current low sentiment and positioning may support further upside.

For the full interview, watch the accompanying video

Catch all the latest updates from the stock market here