Shares listed on Indian exchanges hit a combined value of $4.33 trillion at Monday’s close, surpassing Hong Kong’s $4.29 trillion, which positions India as the world’s fourth-largest equity market, as per Bloomberg on Tuesday.
The value of Indian stocks first surpassed $4 trillion on Dec. 5, with about half of this growth happening in the last four years, primarily driven by a burgeoning retail investor base and strong corporate earnings.
As an alternative to China, India, the world’s most populous country, draws new capital from global investors and companies due to its political stability and a consumption-led economy that ranks among the fastest-growing major economies.
The surge in Indian stocks has happened alongside a significant downturn in Hong Kong, home to many of China’s key and innovative companies.
Strict Covid- 19 measures in Beijing, regulatory actions against businesses, a crisis in the property sector, and geopolitical conflicts with the West have collectively diminished China’s attractiveness as a global growth hub.
“We see India as the best structural growth story across not just emerging markets but worldwide,” said CEO at Global X ETFs, Evan Metcalf.
“While China’s growth has stalled and is mired in uncertainty, India has a generational opportunity to emerge as the growth engine of emerging markets. Demographics are a key advantage, with a surge in educated youth and a progressive government pursuing key structural reforms,” he added.
Equities in China and Hong Kong are experiencing a significant downturn, with their total market value dropping by more than $6 trillion from their 2021 highs. Hong Kong, once a bustling hub for initial public offerings, is seeing a decline in new listings.
