ACTION PUNJAB NEWS Desk: In a significant milestone, India has surpassed Hong Kong to claim the position of the world’s fourth-largest stock market. The combined value of shares listed on Indian exchanges reached $4.33 trillion at the close of Monday’s trading, edging past Hong Kong’s $4.29 trillion, as reported by Bloomberg. This achievement underscores India’s rising prominence in global financial markets, driven by robust growth prospects and policy reforms.
India’s stock market capitalization crossed $4 trillion for the first time on December 5, marking a historic milestone. Over the past four years, the Indian equity market has experienced remarkable growth, fueled by an expanding retail investor base and impressive corporate earnings. The nation has emerged as a preferred destination for global investors and companies, offering stability in its political landscape and a consumption-driven economy that ranks among the fastest-growing globally.
Ashish Gupta, Chief Investment Officer at Axis Mutual Fund in Mumbai, remarked, “India has all the right ingredients in place to set the growth momentum further.”
While India’s stock market has witnessed a relentless rally, Hong Kong has faced a historic slump, impacted by stringent anti-Covid-19 measures, regulatory crackdowns, a property-sector crisis, and geopolitical tensions. The decline in China’s appeal as a global growth engine has led to a significant equity rout, with the total market value of Chinese and Hong Kong stocks plummeting by over $6 trillion since their peaks in 2021.
Despite the challenges faced by China and Hong Kong, some strategists anticipate a potential turnaround. UBS Group AG foresees Chinese stocks outperforming Indian counterparts in 2024, citing significant upside potential in the battered valuations of the former. However, Bernstein expects the Chinese market to recover and suggests taking profits on Indian stocks, considering them expensive.
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Foreign investment trends favor India, with overseas funds redirecting their focus from China to its South Asian counterpart. Global pension and sovereign wealth managers are also showing a preference for India, according to a study by the Official Monetary and Financial Institutions Forum.
In 2023, foreign funds infused over $21 billion into Indian shares, contributing to the eighth consecutive year of gains for the benchmark S&P BSE Sensex Index. A survey conducted by Goldman Sachs Group Inc.’s Global Strategy Conference revealed a clear consensus that India is viewed as the best long-term investment opportunity, further solidifying its standing in the global financial landscape.
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(Inputs from agencies)
