Compared to almost all the major stock markets in the world, the market cap of the Indian stock market has declined the most in the last one month. The total market value of companies listed in the Indian stock market has decreased by about $ 463 billion in the last one month and now it is at about $ 4.7 trillion. This is a decline of about 9 percent, which is much more than that of almost all the major stock markets of the world. This information has been obtained from data collected by Bloomberg.
In comparison, the US market cap declined by just 1.8% and now stands at $63 trillion. A decline of 6.2% was recorded in China. The UK market fell 4.1% and Canada fell 3.2%. The total market share of companies listed in the stock exchanges of Japan and Hong Kong declined by about 2.3 percent. However, their Saudi Arabia has performed well, which is currently the ninth largest stock market in the world with a market cap of $2.7 trillion. The market there has benefited from the rise in crude oil prices due to strict sanctions on Russia and Iran.
Main reasons for decline in Indian market
Many pressures are currently acting on the Indian stock market.
1. Weakness of Rupee:
– In the last one month, the rupee weakened by 2% to 86 per dollar.
– Weak rupee makes the Indian market less attractive for foreign investors.
2. Selling by foreign investors:
– Foreign portfolio investors (FPIs) have sold shares worth $6.7 billion so far this month.
– FIIs have withdrawn money from Indian stocks every day this month except January 2.
3. Rise in oil prices:
– India is a net oil importing country. Rising oil prices increase import costs, putting pressure on the market.
Sayon Mukherjee of Nomura says that huge uncertainty is being seen in the global economy since the beginning of 2025. He said that there is a big difference in the expectations of growth, inflation and interest rates in the economies of almost all major countries, which can increase risks and affect the valuations of companies.
Nomura estimates that Nifty-50 may remain between 21,800 and 25,700 by the end of 2025. The brokerage said it is advising investments in sectors like financials, consumer staples, oil and gas, pharma, telecom, power, internet and real estate. On the other hand, it expects consumer discretionary, auto, capital goods, cement, hospitals and metals to perform poorly.
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