In a milestone achievement, India has overtaken Hong Kong to become the fourth largest equity market globally for the first time, reported Bloomberg. As of Monday, the combined value of shares listed on Hong Kong’s exchange stood at $4.29 trillion as against India’s $4.33 trillion.
Indian stock market capitalisation crossed the $4 trillion mark for the first time on December 5.
While India continues to see a rapidly growing retail investor base, sustained inflows from foreign institutional investors (FII), strong corporate earnings and robust domestic macroeconomic fundamentals, Hong Kong markets have suffered a major slump where some of China’s most influential and innovative companies are listed.
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The total market value of Chinese and Hong Kong stocks has plunged by more than $6 trillion since their peaks in 2021. As per Bloomberg, Beijing’s stringent anti-Covid-19 curbs, regulatory crackdowns on corporations, a property-sector crisis and geopolitical tensions with the West have all combined to erode China’s appeal as the world’s growth engine.
Meanwhile, the report points out that India has positioned itself as an alternative to China, attracting fresh capital from global investors and companies alike, thanks to its stable political setup and a consumption-driven economy that remains among the fastest-growing of major nations.
New IPO listing in Hong Kong have also dried up, pushing the Asian Financial hub to lose its status as the world’s busiest venues for initial public offerings (IPO). Meanwhile, Indian stock market extended gains for the eight consecutive year of gains in 2023, as the overseas funds poured more than $21 billion.