India’s pie in global mcap rises to 4.3%

Mumbai: Indian capital market’s weightage in global market capitalization (mcap) is increasing, observes a latest report. Further, India’s strong macroeconomic fundamentals- robust GDP growth, controlled inflation, managed twin deficits and record foreign reserves- have kept the rupee resilient despite foreign institutional investor (FII) outflows, the report showed on Wednesday. “India’s contribution to world market cap has also grown from 1.7 per cent in 2013 to 4.3 per cent now, and in terms of the market cap ranking India has improved from 17th to 5th,” stated the report by Motilal Oswal Private Wealth (MOPW).

Equities as an asset class are also gaining allocation in the Indian household savings. India’s considerably large size and diverse sectoral offerings place India among the key equity markets globally, it added.

In the long term, the equity market outlook is positive due to corporate deleveraging and expected healthy earnings over the next two years.

“However, short-term volatility is anticipated due to global uncertainties like geopolitical issues, central bank policies, and valuations. Investors are advised to proceed cautiously with a balanced strategy,” the report said.

Most of the emerging markets have experienced FII outflows during October amid uncertainty around US election, geopolitical tensions in Middle East, stimulus announcement by China and rise in US yields.