The growth in the Indian stock market came on the back of a growing retail investor base, persistent inflows from foreign institutional investors (FII), strong corporate earnings, and solid domestic macroeconomic fundamentals.
India’s stock market has overtaken Hong Kong’s for the first time to rank as the fourth-biggest equity market globally by market capitalization. India’s market cap stood at $4.33 trillion on Tuesday as compared to $4.29 trillion for Hong Kong, reported Bloomberg.
Currently, the US is the world’s biggest stock market with mcap of $50.86 trillion followed by China with a mcap of $8.44 trillion and Japan at $6.36 trillion.
India’s stock market capitalization crossed $4 trillion for the first time on 5 December, with around half of that coming in the past four years, according to Bloomberg. The growth in the Indian stock market came on the back of a growing retail investor base, persistent inflows from foreign institutional investors (FII), strong corporate earnings, and solid domestic macroeconomic fundamentals. The Indian markets have settled with gains for eight consecutive years and are poised for further growth.
On the other hand, Hong Kong’s Heng Seng has witnessed a record four-year losing streak while the Shanghai Stock Exchange saw its second consecutive year of losses. The negative sentiment toward China and Hong Kong has further deepened this year due to a lack of major economic stimulus measures.
According to Bloomberg, India has positioned itself as an alternative to China, attracting fresh capital from global investors and companies alike, thanks to its stable political setup and a consumption-driven economy that remains among the fastest-growing of major nations.
The Hang Seng China Enterprises Index, a gauge where some of China’s most influential and innovative firms are listed, is already down about 13 per cent this year. China’s stringent anti-COVID-19 curbs, regulatory crackdowns on corporations, a real estate crisis, and geopolitical tensions with the West have all combined to erode its position as the world’s growth engine. The total market value of Chinese and Hong Kong equities have plunged over $6 trillion, since their peaks in 2021.