India becomes the fourth-largest stock market in the world, surpassing Hong Kong

India becomes the fourth-largest stock market in the world, surpassing Hong Kong

India becomes the fourth-largest stock market in the world, surpassing Hong Kong

Bloomberg data shows that at Monday's closing, the total value of equities listed on Indian markets was $4.33 trillion, while Hong Kong's value was $4.29 trillion.

India becomes the fourth-largest stock market in the world, surpassing Hong Kong.

For the first time, India's stock market has surpassed Hong Kong's, which is a significant achievement for the South Asian nation whose policy changes and promising economic development have made it a favorite among investors.

Bloomberg data shows that at Monday's closing, the total value of equities listed on Indian markets was $4.33 trillion, while Hong Kong's value was $4.29 trillion. India now has the fourth-largest equities market in the world. On December 5, its stock market value exceeded $4 trillion for the first time, with over half of that amount occurring in the previous four years.

India's equity market is expanding quickly because of robust corporate profitability and a rapidly expanding pool of individual investors. Due to its stable political structure and rapidly expanding economy driven by consumerism, the most populous nation in the world has positioned itself as a viable alternative to China, drawing in new investment and business from across the globe. rises from.

The chief investment officer of Mumbai's Axis Mutual Fund, Ashish Gupta, said, "Everything is in place to drive growth in India."

In tandem with the ongoing surge in Indian equities, Hong Kong, home to some of China's most significant and inventive corporations, has seen a historic downturn. China's attractiveness as the world's economic engine has been undermined by Beijing's severe COVID-19 limitations, regulatory crackdown on firms, property-sector crises, and geopolitical tensions with the West.

Additionally, since their high in 2021, the market value of Chinese and Hong Kong stocks has dropped by more than $6 trillion, precipitating a significant decline in equities. Hong Kong has seen a decline in new listings, and the Asian financial center is no longer among the world's busiest places for IPOs.

Some strategists, nevertheless, are optimistic about a shift. In a research published in November, UBS Group AG predicted that Chinese equities will beat their Indian counterparts in 2024 because, despite the latter's "pretty extreme levels," the former's cheap valuations imply there is room for big upside if mood shifts. Bernstein expects the Chinese market to strengthen and advises taking gains on Indian equities, which he views as overvalued, according to a note he sent earlier this month.

He said that it seems like India is now gaining pace.

With no significant economic stimulus measures implemented in the new year, pessimism toward China and Hong Kong has grown. After ending a record-breaking four-year slide in 2023, the Hang Seng China Enterprises Index, which measures Chinese firms listed in Hong Kong, is already down almost thirteen percent. The measure is on course to reach its lowest point in over 20 years, even as the benchmarks for Indian stocks are trading close to all-time highs.

Foreign investors, who were previously captivated by China's success, are now funding its challenger in South Asia. The Official Monetary and Financial Institutions Forum, a research tank located in London, released a report recently that suggests that global pension and sovereign wealth managers are also supporting India.

In 2023, foreign investors made over $21 billion in Indian stock investments, contributing to the benchmark S&P BSE Sensex index's ninth straight year of gains.

Goldman Sachs Group Inc. strategists Guillaume Jason and Peter Oppenheimer said in a letter dated January 16 that accompanied the findings of a poll conducted at the firm's Global Strategy Conference, "There is a clear consensus that India is the best long-term investment opportunity."