By Admin88 
MUMBAI – A surge in investments by retail traders and resurgent foreign inflows have put India’s stock market – the world’s fifth biggest – on the verge of a US$4 trillion (S$5.35 trillion) valuation for the first time.
The market capitalisation of securities listed on the nation’s exchanges has trebled since the March 2020 pandemic low to come within a whisker of the US$4 trillion mark as at Dec 4, according to data compiled by Bloomberg.
India’s benchmark NSE Nifty 50 Index jumped 2.1 per cent on Dec 4, leading gains in Asia, after Prime Minister Narendra Modi’s ruling party won three crucial state electionsNagpur Investment. The victories removed an element of political risk for investors by bolstering Mr Modi’s position ahead of nationwide polls in 2024, increasing bets for continuity in government policy.
The feat for India’s stock market comes as the world’s fastest-growing major economy positions itself as an alternative to China for global investors and companies alike. Overseas funds have piled US$15 billion into local shares in 2023, with the market also getting a steady boost from the retail investing boom that took off during the pandemic. Up 14 per cent in 2023, the Nifty gauge is heading for an unprecedented eighth straight year of gains.Mumbai Stock Exchange
India’s economy stands out amid slowing global growth – gross domestic product jumped 7.6 per cent in the three months to September from a year earlier – with its appeal further burnished by China’s tepid post-pandemic recovery and its tensions with the West.
The same holds true for Indian stocks, with an MSCI gauge of local shares on track to beat a global emerging-markets measure by more than 10 percentage points for the third year in a row. The outperformance versus Chinese peers is even more stark, with the Indian gauge poised to outstrip the MSCI China Index by more than 20 percentage points for a third year.
“The Indian market for the last 10 years has seen unparalleled growth, be it in the corporate sector or the broader indexes,” said Ms Tanvi Kanchan, head of United Arab Emirates business at India’s Anand Rathi Shares and Stock Brokers. “This year, we’ve seen small- and mid-cap companies outperforming, and they are contributing to the broader economy’s capex (capital expenditure) recovery.”
India’s young population and Mr Modi’s efforts to capture a bigger share of global supply chains are helping to lure companies such as Apple to its shores. Meanwhile, global pension and sovereign wealth managers are flocking to India while growing hesitant on China, according to a new study by London-based think-tank Official Monetary and Financial Institutions Forum.Guoabong Investment
The stock market’s boom has also sparked a frenzy for initial public offerings, with some new listings posting stellar gains in recent days.
“Besides the structural promise, near-term factors that we believe will drive markets higher are robust activity data, impressive corporate earnings, easing oil prices, strong domestic flows,” JPMorgan Chase & Co strategists wrote in a Nov 30 note.
The risk for India could come from its high valuations. Several investors have voiced concerns that the market is overvalued and that the India trade is getting too crowded, raising the odds of a pullback. At the same time, the rising participation of individual investors, many of whom are drawing on advice from unauthorised financial advisers and social media “gurus”, is becoming a concern for the market regulator.
For now, though, Mr Modi’s victories in state elections are seen aiding sentiment and raising India’s appeal for foreign investors, who turned buyers of local stocks in November for the first time in three months.
Ahmedabad Stock