On Thursday, the market capitalization of India reached a new high when it crossed the Rs 295 lakh crore threshold thanks to consistent foreign fund purchases since March. At the closing of trade, the BSE market capitalization (mcap), which represents the combined worth of all listed companies, closed marginally down at Rs 293.5 lakh crore. On December 14, 2022, the market cap reached its highest-ever close of Rs 294.8 lakh crore.
With a market capitalization of $3.4 trillion, India is the fifth-largest stock market in the world, trailing only Hong Kong ($5.2 trillion) and France ($3.2 trillion) in terms of dollars. According to CDSL and BSE data, since March of this year, the monthly number for stock trades by foreign portfolio investors (FPIs) has become net positive. After a fantastic May in which the Indian stock market saw inflows of over Rs 43,800 crore, June has seen inflows of only Rs 13,124 crore. However, as a result of substantial net withdrawals in January and February, CDSL data revealed that the net inflow amount for 2023 is close to Rs 42,400 crore. This does not include the provisional net inflow amount of Rs 3,086 crore that was published on the BSE website on Thursday.
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BSE witnesses Sensex reaching the skies:
The Sensex reached an intraday high on Thursday of 63,311 points, only 300 points short of its all-time high of 63,583 points, which was reached on December 1, 2022. The Nifty was also just a few points away from 18,888, its all-time high set in last December, which was less than 100 points away. The Sensex has now increased by around 9.5% to 62,918 points since reaching a recent low of 57,527 points on March 24. And according to market participants, this bounce is being driven by heavy FPI purchasing. They further claim that the surge is supported by solid fundamentals such as high tax receipts, low inflation, and a stable rupee.
Comparatively speaking, they said that the relative underperformance of the Chinese economy had aided in the inflow of foreign capital into India, which in turn had a positive impact on the stock market. According to economists, India will continue to compete with other developing Asian markets for capital inflows.
