Edited by Deepali Verma
A noteworthy achievement came to light as Bharat’s stock market surpassed Hong Kong’s for the first time, recording another milestone for the South Asian nation. The investor-friendly environment, along with promising growth potential and proactive policy reforms, continues to elevate Bharat’s standing as a lucrative destination for investment.
Bloomberg’s report reveals that the aggregate value of shares listed on Indian exchanges has achieved a milestone, peaking $4.33 trillion at the close on January 22, surpassing Hong Kong’s $4.29 trillion. This places Bharat as the world’s fourth-largest equity market. Notably, Bharat’s stock market capitalization has previously surpassed $4 trillion for the first time on December 5.
Alternative to China
The report added that Bharat’s stock market is registering a surge that is propelled by a swiftly expanding retail investor community along with robust corporate earnings. Bharat, world’s most populous country, has emerged as a compelling alternative to China, pooling substantial investments from global investors as well as corporations. Bharat’s stable political environment as well as a consumption-driven economy that maintains its rank among the fastest-growing among major nations.
The continuous surge in Indian stocks is in line with a significant downturn in Hong Kong that houses some of China’s most influential and innovative companies. Beijing’s strict anti-COVID-19 measures that involve regulatory actions against corporations, a crisis in the property sector as well as geopolitical tensions with Western nations have collectively diminished China’s allure as the global growth engine.
Several factors have instilled a severe downturn in equities that achieved unprecedented levels, as the combined market value of Chinese and Hong Kong stocks has deteriorated by over $6 trillion since their peaks in 2021. In Hong Kong, the absence of new listings has resulted in the loss of its status as one of the globe’s most active venues for initial public offerings.
Outlook 2024
Additionally, the report revealed optimism among certain strategists for a reversal of fortunes. UBS Group AG anticipates that Chinese stocks will outshine their Bharatiya counterparts in 2024. The Chinese stocks evaluation indicates significant upside potential once the sentiment improves, contrasting with Bharat’s November report, where the valuations are considered to be at “fairly extreme levels.”
Bernstein is anticipating a recovery in the Chinese market and the advice is to capitalise on profits from Bharatiya stocks, perceived as expensive, as per the statement in a note earlier this month.
