Modi factor helps stock market cap cross $1.5 trln

MUMBAI Tue Jun 10, 2014 1:38pm IST

Prime Minister Narendra Modi takes his oath at Rashtrapati Bhavan in New Delhi May 26, 2014. REUTERS/Adnan Abidi

Prime Minister Narendra Modi takes his oath at Rashtrapati Bhavan in New Delhi May 26, 2014.

Credit: Reuters/Adnan Abidi

Related Topics

MUMBAI (Reuters) - The combined market capitalisation of India's publicly listed companies crossed $1.5 trillion on Monday, as billions of dollars poured into India in the wake of Narendra Modi's stunning election victory last month.

Modi, leading the Hindu nationalist Bharatiya Janata Party, scored the biggest election win for 30 years, pledging sweeping reform to create jobs and boost an economy growing below 5 percent - its slowest in more than a decade.

Strong foreign buying has pushed both the Sensex and the broader Nifty up by just over 20 percent so far this year, posting a series of record highs - the latest on Monday - and far outperforming a 5 percent gain in the MSCI Asia-Pacific index excluding Japan.

Foreign investors have bought a net $8.55 billion so far this year, with $3.31 billion coming since the beginning of May.

At $1.52 trillion as of Monday's close, the market value of the National Stock Exchange and the smaller Bombay Stock Exchange makes India the second largest among emerging markets in Asia, ahead of South Korea, but still below the market cap of $2.4 trillion for Shanghai-listed shares, according to Thomson Reuters data.

India's market capitalisation, however, remains below a peak average of $1.82 trillion hit in December 2007, according to data from BSE.

"This is an excellent time to invest, and our belief is that we are in a long-term bull market that is likely to play out in the next 7-10 years," Vijai Mantri, chief executive of Pramerica Asset Management said.

"Along with the strong foreign flows we are also beginning to see domestic flows returning to the market, which is likely to support the rally."

Shares of state-run companies, seen as desperately in need of reform, have rallied the most, with the CNX Public Sector Enterprises Index gaining 22.3 percent since May 15th.

Other gainers include domestic oriented sectors such as infrastructure and construction, along with interest rate sensitive sectors such as banking and automobile company stocks.

(Reporting by Himank Sharma; Editing by Simon Cameron-Moore)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS EXCLUSIVE

REUTERS SHOWCASE

Modi In U.S.

Modi In U.S.

Obama, Modi work to deepen improving U.S.-India ties  Full Article | Related Story 

Factory Activity

Factory Activity

Factories expand at slowest pace this year in September  Full Article 

Videocon d2h IPO

Videocon d2h IPO

Videocon d2h files for up to $113 million IPOs  Full Article 

Asian Economy

Asian Economy

Asian factories slow in Sept, push inflation ever lower  Full Article 

EBay Divests PayPal

EBay Divests PayPal

EBay follows Icahn's advice, plans PayPal spinoff in 2015  Full Article 

New 'Windows'

New 'Windows'

Microsoft names next operating system 'Windows 10'.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage