In a remarkable turn of events, India’s stock market has achieved a significant milestone, surpassing Hong Kong to become the world’s fourth-largest stock market by market capitalization. As of January 22, 2024, India’s stock market boasts a market capitalization of $4.3 trillion, narrowly edging past Hong Kong’s $4.29 trillion, according to Bloomberg’s report.
The global rankings of stock markets by market capitalization are currently led by the United States, with a staggering value of nearly $51 trillion, followed by China at $8.5 trillion and Japan at $6.5 trillion. India’s ascent to the fourth position is a testament to its remarkable economic growth and resilience.
India’s stock market has been on an impressive bull run, gaining momentum since hitting a multi-year low in late March 2020. Several factors have contributed to this impressive rise. First, the global shift toward diversifying supply chains away from a heavy reliance on China has benefited India, positioning it as a prominent alternative manufacturing hub.
Second, India’s economy has demonstrated robust resilience, outpacing the Chinese economy, which faced a slowdown in the post-pandemic era. International fund managers are increasingly allocating funds to India, recognizing its potential and stability.
On the domestic front, India’s economy is thriving, solidifying its position as one of the fastest-growing major economies globally. Factors such as strong growth in tax collections, controlled inflation, impressive corporate earnings, and currency stability have bolstered investor confidence in the Indian market.
Since March 2020, India’s benchmark index, the Sensex, has surged by two-and-a-half times, while Hong Kong’s Hang Seng index has experienced a 33% decline. India’s outperformance, coupled with the successful listings of numerous companies on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE), has culminated in India’s stock market outshining Hong Kong.
Suman Bannerjee, Chief Investment Officer (CIO) at Hedonova, a hedge fund based in Paris, lauded India’s achievement as a testament to the nation’s economic strength and dynamism. He emphasized that India’s ascent to the fourth position in global stock market rankings underscores its resilience and investor confidence. It signifies India’s emergence as a key player in the international financial landscape, offering promising opportunities for investors navigating the vibrant Indian stock market.
India’s remarkable feat in becoming the world’s fourth-largest stock market is a source of pride and a testament to its economic fortitude. It showcases the nation’s promising trajectory on the global financial stage, with its stock market poised for further growth and success.