Now This For India ETFs: JPMorgan's No Fan

Exchange traded funds tracking India, the "I" in the venerable and now infamous BRIC acronym, really do not need any more bad news.

Already the worst performers among the single-country BRIC funds, India ETFs have been beset by sagging growth, a plunging rupee that has touched multiple record lows against the U.S. dollar and a widening current deficit, it would seem investors would be running short on negative tidings pertaining to Asia's third-largest economy.

JPMorgan sees things differently. During Tuesday's Asian session, the bank downgraded its rating on Indian stocks to Neutral from Overweight. To its credit, JPMorgan acknowledged it was late in downgrading India, but said if the rupee continues to tumble, Indian stocks would continue to lag, Reuters reported.

Related: More Misery Ahead For India ETFs.

Citigroup chimed in, paring its target on the BSE Sensex to 18,900 from 20,800. All that just a couple of weeks after Goldman Sachs pared its rating on the country's stocks to Underweight. And all that as seven India ETFs reside on the list of the 18 worst-performing ETFs over the past month. That list includes the Direxion Daily India Bull 3X Shares INDL, which undergoes a 1-for-4 reverse split today.

That list also includes the Market Vectors India Small-Cap ETF SCIF, which was reverse split 1-for-4 at the start of July.

Underscoring just how bad some ETFs have been this year, the EGShares India Consumer ETF INCO, the EGShares India Small-Cap ETF SCIN, the EGShares India Infrastructure ETF INXX and the iShares MSCI India Small-Cap ETF SMIN have all posted declines of at least 16 percent in the past month and none of those funds reside on the aforementioned list of India ETF infamy.

There have been times this year when Indian stocks and ETFs looked good. There were even times when foreign investors were putting capital to work in Indian equities, but the falling rupee and talk of Federal Reserve have put those themes to rest.

Foreigners have pulled about $12 billion from local stocks and bonds while the rupee has plunged 14 percent since May 22 when tapering chatter began in earnest, according to Bloomberg.

A simple way of looking at the rupee recently has been to say if the forex market is open, there is a good chance the Indian currency is touching another record low against the dollar. That is regularly the rupee has been hitting record lows against the greenback.

That regularity is frightening given the Reserve Bank of India's efforts to stem the currency's slide. RBI has has raised the marginal standing facility and bank rates, capped injections into the financial system and tightened banks' daily reserve requirements to curb money supply, Bloomberg report. And that is just since last month.

Over that same time, all five of the India ETFs with at least $200 million in assets under management have posted declines in the teens on a percentage basis with the iPath MSCI India Index ETN INP being the worst offender. Since May 20, all five have tumbled by more than 20 percent, meaning all five are officially in bear market territory.

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Disclosure: Author owns known of the securities mentioned here.