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India again becomes world's fifth largest stock market as investors pip China, Adani stocks rebound

New DelhiEdited By: Mukul SharmaUpdated: May 30, 2023, 04:13 PM IST
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India reclaimed its spot as the world's fifth largest stock market amid rapid revival in Adani Group stocks Photograph:(PTI)

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India stock market rebound: Powered by investors choosing India, and a revival in Adani Group stocks, India's stock market capitalisation beat that of France.

India's stock market capitalisation beat that of France to reclaim its spot as the world's fifth largest stock market, amid rapid revival in Adani Group stocks.

Foreign investors bought shares worth $4.5 billion in May so far, a little more than a two-fold increase from last month, according to India’s National Securities Depository. 

The US remains the world's largest stock market with a market capitalisation of $44.54 trillion, followed by China ($10.26 trillion), Japan ($5.68 trillion) and Hong Kong ($5.14 trillion).

India stock market rebound: How much is it?

The market capitalisation of India stood at $3.3 trillion as of Friday. This was aided by rebound in Adani Group shares from a rout earlier this year in the wake of shortseller Hindenburg's adverse report.

Investors choose India over China

Meanwhile, a number of overseas funds have been rotating money out of China into Indian stocks.

Beijing’s stringent Covid-19 policies, turmoil in its real estate industry, and a wave of anti-trust campaigns against China’s valuable tech firms have crushed sentiments for Chinese assets, economists say.

Mark Mobius, founder of Mobius Capital Partners and a market expert, also sees India as a viable alternative. "You have got a billion people (Indians), they can do the same thing that the Chinese do. They can do the same kind of manufacturing and so forth," Mobius was quoted as saying by Fox Business. 

Earlier, Christopher Wood, strategist at Jefferies Financial Group, increased the weight of Indian stocks in his Asia Pacific portfolio, excluding Japan, Bloomberg reported. 

This reflects the dissatisfaction among investors when it comes to the Chinese stock market.

ALSO WATCH | Decoding India’s stock market | The India Story

Foreign investors have added $5.7 billion worth of India stocks since the start of April, chasing stable earnings growth and aided by one of the highest GDP growth rates among large economies in the world, Bloomberg reported.

India's stock market rebound: Adani revival a crucial factor

A panel appointed by India's Supreme Court had found no conclusive evidence of stock price manipulation as accused by the US short seller Hindenburg Research. 

Adani Group's 10 listed entities added nearly $15 billion to their market value last week to trim their losses post-Hindenburg’s report to $105 billion from as high as $153 billion earlier.

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