Indian Stock Market Reclaims $5 Trillion Market Cap as Rally Gains Momentum

Investments Indian Investments

Posted by NewAdmin on 2025-04-21 08:50:53 |

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The market capitalization of all companies listed on the Bombay Stock Exchange (BSE) has once again surpassed the $5 trillion mark after a gap of three months. This milestone comes on the back of a strong and sustained rally across both large-cap and broader market stocks. The last time India's market capitalization stood above $5 trillion was on January 20. Since then, the market had seen a dip, falling to $4.5 trillion by April 7. However, a robust rebound of over $500 billion has taken place since that low, pushing the total value back above the symbolic $5 trillion mark.

This market revival has been fueled by notable gains across indices. The Sensex and Nifty have both appreciated by nearly 9 percent. The broader BSE Midcap and Smallcap indices have performed even better, with gains of 9.4 percent and 10.6 percent respectively. The Nifty Bank index surged 11 percent, and the BSE PSU Index has climbed 10 percent during the same period. The positive sentiment in the market is also being supported by falling crude oil prices, which are helping to contain inflation and improve India’s trade balance. Furthermore, corporate earnings estimates for the June quarter are projecting a modest growth of 2 to 3 percent, adding to the domestic optimism.

Foreign investor confidence has also returned, with the National Securities Depository Limited (NSDL) reporting net inflows of over $1 billion in just the past two sessions. This inflow reflects a renewed interest from global investors, likely influenced by India’s relative economic stability and attractive valuations when compared with other emerging markets. The visit of US Vice President JD Vance to India has further heightened market expectations around improved trade ties and economic cooperation.

Market analysts believe that despite the recent gains, there is still room for further upside, estimating a potential 5 to 10 percent increase from current levels. However, they advise caution due to ongoing global uncertainties and macroeconomic challenges. While domestic themes and sectors such as financials, public sector undertakings, metals, telecom, pharmaceuticals, and consumption are expected to drive momentum, sectors like IT and infrastructure are also showing promising setups. Nonetheless, key indices such as the Sensex and Nifty are still more than 7 percent below their 52-week highs, with mid and smallcap indices down by 13.8 percent and 15.8 percent respectively.

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