New Delhi, Jan 23: Firm GDP growth forecasts, inflation at manageable levels, political stability at the central government level and signs that the central bank is done with tightening its monetary policy have all contributed to painting a bright picture for the Indian stock market.

India pipped Hong Kong to become the fourth-highest equity market globally, Bloomberg reported. The combined value of shares listed on Indian exchanges reached USD 4.33 trillion as of Monday's close, versus USD 4.29 trillion for Hong Kong, according to data compiled by Bloomberg.

India's stock market capitalization crossed USD 4 trillion for the first time on December 5, 2023, with about half of that reportedly coming in the past four years. The top three stock markets are those of US, China, and Japan.

Cumulatively, the past 12 months have been stellar for investors who parked their money in Indian stocks. Though there has been some turbulence, the calendar year 2023 gave handsome monetary dividends to stock market investors. In 2023 itself, Sensex and Nifty gained 17-18 per cent, on a cumulative basis. They gained a mere three to four per cent each in 2022.

Hong Kong's benchmark Hang Seng Index cumulatively declined 32-33 per cent over the past year, data showed.

Notably, foreign portfolio investors have again trained their sight towards India, becoming net buyers in the country's stock market. In the process, it helped Indian benchmark stock indices taste their all-time highs recently.

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According to the news report, 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. New listings have dried up in Hong Kong, with the Asian financial hub losing its status as one of the world's busiest venues for initial public offerings (IPOs).

India remains the fastest-growing country among the top 10 global economies. The strong post-pandemic recovery and resilient performance amid global headwinds demonstrate the inherent strength of the economy. Strong growth, prudent policy reforms, government's focus on infrastructure and capex, healthy corporate books, comfortable forex reserves, and lower commodity cost inflation could protect India from any external shocks and position it to outpace other countries in the coming decade.

India's steady rise in the economy and it becoming an island of growth when other countries are struggling to grow or seeing a nominal rise is a positive. China's relative decline over the past 3-4 years since the Covid has hurt Hong Kong, as several Chinese companies are listed in Hong Kong.

The Hong Kong stock market has various Chinese companies listed on it, and we have seen that they have steadily declined and are going out of prominence. While the Indian market is gaining prominence, backed by foreign portfolio investors' investments, domestic investors are also steadily trying to mark it up.

India now has huge potential...Once the purchasing power of Indians improves further, they will save more and invest more in the market.

(ANI)