As the AI boom shakes major stock indices, the NSE Nifty 50 Index is increasingly seen by global investors as a kind of safe-haven asset. In the first half of this year, the index moved by 1% or more from the previous day on only about one-third of trading days, less than the MSCI Emerging Markets Index and only slightly more than the S&P 500. With few AI-related stocks in the Indian market, funds had flowed for much of the year to higher-return markets like South Korea and Taiwan, creating headwinds, but as concerns grow over the sustainability of those trades, investor interest is gradually returning to India. In June, the Nifty 50 outperformed the MSCI Emerging Markets Index by the most since November 2025, and outflows by foreign investors fell to a four-month low. Maxence Visseaux, chief investment officer at Archebium Capital, said, 'There is one reason the Indian market is calm: it sits outside the AI trade,' adding that India acts as an AI hedge within the broader emerging market universe. Factors that had weighed on oil refiners and airline stocks are easing, with a stable rupee and a pause in crude price rises due to easing Middle East tensions, while a government report points to receding inflation concerns and an improving economic growth outlook. Morgan Stanley analysts said India has become a 'much larger macro asset class' and transformed into a defensive growth market, while BlackRock's chief investment strategist noted that easing pressures could see India regain attention as a differentiated investment opportunity within emerging markets.