India Becomes the Anti-AI Trade as Global Tech Sell-Off Sends Investors Hunting for Shelter

India's stock market is suddenly the hot ticket. Over the past month, the benchmark Nifty 50 has climbed nearly 9%, while AI-heavy indexes in the U.S., Japan, South Korea and Taiwan bleed out. On Friday, Indian benchmarks traded higher even as the Nasdaq Composite slid into correction territory overnight, Japan's Nikkei 225 and Taiwan's Taiex tumbled into bear market territory and South Korea's Kospi deepened its own bear run.

The reason is simple: India's indexes barely touch the AI hardware trade. Instead, they lean on financial services, consumption, energy, industrials and other services. Goldman Sachs' Timothy Moe told CNBC's 'Squawk Box Asia' that India and Australia, both lightly exposed to AI, will see 'some relative outperformance' — and India's 'domestic demand story' gives it the edge. Feroze Azeez of Anand Rathi Wealth said India's size, liquidity and low dependence on the AI cycle make it 'an attractive alternative.'

JPMorgan's Rajiv Batra sees real money behind the shift. Foreign long-only investors have been underweight on India for roughly two years, and simply neutralizing that stance could mean around $115 billion in net inflows, he told CNBC. Falling global oil prices, softer U.S. Treasury yields, recovering earnings and the unwinding AI trade are all stacking up in India's favor, he said. 'India has emerged as an