Currently, the US is the world's biggest market with a mcap of $50.86 trillion followed by China with a mcap of $8.44 trillion and Japan $6.36 trillion.
January 23, 2024 / 08:52 AM IST
Indian stocks reached new highs in 2023 due to bullish investors and increased domestic participation
India pipped Hong Kong to become the world's fourth largest stock market by market capitalisation on January 22.India’s market cap stood at $4.33 trillion onTuesday as against $4.29 trillion for Hong Kong, according to data from Bloomberg. Currently, the US is the world's biggest market with a mcap of $50.86 trillion, followed by China with a mcap of $8.44 trillion and Japan at $6.36 trillion.
Indian stocks reached new highs in 2023 due to bullish investors and increased domestic participation. However, a recent correction followed a lower-than-expected earnings in HDFC Bank. Analysts believe that anticipated rate cuts by global central banks in 2024 could boost investor confidence, further fueling the Indian market rally. Investors are now anticipating the budget announcement on February 1.
In 2023, both Sensex and Nifty advanced 18.8 percent and 20 percent, respectively, while BSE MidCap and SmallCap jumped 45.5 percent and 47.5 percent, respectively. Among the top gainers, Tata Motors jumped 101 percent, Bajaj Auto advanced 88 percent, NTPC rose 87 percent, L&T gained 69 percent, while Coal India surged 67 percent.
India on the up
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Hong Kong's Heng Seng declined for the fourth consecutive year, while the Shanghai Stock Exchange saw its second consecutive year of losses. In contrast, the Indian equity markets have gained for eight straight years and are poised for further growth, driven by strong sentiments before the election, improving macroeconomic conditions, and expectations of interest rate cuts.
The recent victory of the Narendra Modi-led National Democratic Alliance (NDA)across multiple state elections has boosted investor confidence, signaling continuity as India heads into central government elections in April 2024. If Modi and the BJP-led NDA secure a third consecutive term, analysts anticipate continued policies and measures to propel India's economy towards the coveted Rs 5 trillion mark.
The Hong Kong markets are falling due to a Chinese economic downturn and pressure on American investors to sell their exposure to Chinese companies. This contrasts with the strong performance of the U.S. market, where inflation eased and the job market remained robust. In 2023, the S&P 500 rose by 25%, highlighting the divergent paths of the world's two largest economies.
Global investors initially expected China's economy to rebound after strict pandemic measures, but when borders fully opened in 2024, households hesitated to spend. This reluctance, coupled with a sluggish economy and China's property crisis, has led to a downturn affecting Hong Kong. Most Chinese real estate developers, having overexpanded and borrowed heavily from foreign investors in Hong Kong, are now facing the prospect of a collapse.
Disclaimer:The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Ravindra Sonavane
first published: Jan 23, 2024 07:39 am
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