Pooja Mahabadi, Pune
India stood ahead of Hong Kong for the first time to rank as the fourth-largest stock market concerning market capitalization in the world. As reported by Bloomberg, India’s capital stood at $4.33 trillion on Tuesday compared to Hong Kong’s $4.29 trillion.
At present, the United States holds the position of the largest Stock Market globally boasting a market capitalization of $50.86 trillion, following closely is China with a market capitalization of $8.4 trillion and Japan at third with $6.36 trillion.
The Bloomberg report also said that India surpassed the four trillion mark for the first time on the 5th of December, with half of it built over the last four years. The current surge in the Indian market is a contribution of the retail investor base community, consistent flows from Foreign Institutional Investors (FII), strong corporate earnings, and stable macroeconomic foundations. The surging growth in Indian markets is also a result of the gains over the past eight years.
Contrasting this, the Hang Seng Index of Hong Kong has witnessed a four-year-long streak of losses. Furthermore, the Shanghai Stock Exchange saw its consecutive second year in the red. To add more, new listings have died down leading to a tumbling of the Asian Finanacial Hub.
As per the Bloomberg report, India is seen as a viable alternative to China, drawing new capital from global investors and corporations. This is seen as an outcome of a stable political environment and a consumption-oriented economy.
The Hang Sang Index has already experienced a 13 percent decline this year. China’s strict measures to combat COVID-19, including regulatory crackdowns on businesses, real estate crisis, and geopolitical tensions with the West have collectively weakened its status as the global growth engine.
However some experts predict that there will be a turnaround in the year 2024 as UBS Group AG perceives that China might outperform the Indian peers. Bernstein also predicts an upstream influx of the Chinese markets.