Dalal Street makes stunning entry into $4-trillion market value club

The combined market valuation of all listed companies on the leading stock exchange BSE reached the USD 4-trillion milestone for the first time ever on Wednesday, mirroring a positive trend in equities.

What is remarkable about this feat is that it took just two-and-a-half years to hit the USD 4 trillion landmark after the market capitalisation (m-cap) of all listed companies on the BSE touched the USD 3-trillion mark on May 24, 2021. The total valuation of exchange-listed companies went past the USD 1 trillion level on May 28, 2007.

The journey from USD 1 trillion to USD 1.5 trillion was covered in 2,566 days or just over seven years on June 6, 2014. The m-cap of listed companies reached USD 2 trillion on July 10, 2017 -- taking 1,130 days from the USD 1.5 trillion level.

It took ten years for the exchange to reach from USD 1 trillion level to USD 2 trillion in market capitalisation. From there, it took 1,255 days to go past the USD 2.5 trillion mark on December 16, 2020.

In the equity market, the 30-share BSE Sensex jumped 727.71 points or 1.10 per cent to settle at 66,901.91 after beginning the day on a positive note. During the day, it zoomed 772.08 points or 1.16 per cent to 66,946.28.

Thanks to the optimism in equities, the market capitalisation of BSE-listed companies reached Rs 3,33,26,881.49 crore in morning trade, translating into USD 4 trillion at the exchange rate of 83.31.

It finally stood at Rs 3,33,29,095.37 crore at the end of trade, translating into USD 4 trillion. The combined market capitalisation of BSE-listed firms hit an all-time high of Rs 333.29 lakh crore.

While the BSE benchmark Sensex has rallied 6,061.17 points or 9.96 per cent so far this year, the market capitalisation of all listed firms on BSE has gone up by Rs 50.90 lakh crore. The 30-share benchmark hit its all-time peak of 67,927.23 on September 15, this year.

Globally, the other markets valued more than USD 4 trillion by m-cap include the US with a market valuation of USD 47.78 trillion, China (USD 9.74 trillion), Japan (USD 6.02 trillion) and Hong Kong (USD 4.78 trillion), according to HDFC Securities.

"The BSE market cap's ascent to the $4 trillion mark signals the start of a fresh momentum in the stock market. Indian stock market is rallying due to solid Q2 earnings and a drop in crude oil prices. Domestic liquidity has provided support to the market, but the lack of foreign fund inflows due to high US bond yields has been a hindrance.

"Fortunately, interest rates in the US have peaked, and the dollar index is declining, which is expected to attract Foreign Institutional Investors (FIIs) into the Indian equity market," said Satish Menon, Executive Director, Geojit Financial Services.

A rally in the broader market also added to the overall optimism. The BSE smallcap gauge has jumped 11,062.78 points or 38.24 per cent so far this year while the midcap index climbed 8,661.06 points or 34.21 per cent.

Also, a number of mainboard Initial Public Offerings (IPO) and listing of shares have propelled the rally in the equity markets. "Indian market cap has risen the most in this fiscal aided by FPI flows and earnings resilience," said Deepak Jasani, Head Retail Research, HDFC Securities.

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