RBI holds repo rate at 6.5%RBI holds repo rate at 6.5%

Virendra Singh Rawat

Amid challenging global macroeconomic matrix due to inflation, flight of capital, regional wars, political upheavals etc, the Indian stock market is touching new highs!

While the Bombay Stock Exchange (BSE) Sensex has hit the 70,000 mark, the National Stock Exchange (NSE) Nifty has breached the 21,000 historic level.

Although Sensex and Nifty are likely to remain range bound at these high levels, yet their upward trajectory and strong fundaments of the domestic economy is undisputed even by skeptics.

The ‘bull run’ in the Indian stock market is the outcome of resilience of the domestic economy and the return of big Foreign Institutional Investors (FIIs), who had shunned the Indian capital markets for the US shores not long ago.

According to experts, the Indian markets may consolidate after the central banks in different countries announce their policy stance this week.

The global markets are primarily driven by the US central bank or Federal Reserve announcements and predictions about its domestic economy.

The stance taken by the Fed with regards to interest rates and monetary policies serve as important markers for other central banks and economies.

Recently, the Indian stocks hit a market cap of 4 trillion dollars. Market cap is the market value of a company listed on a stock exchange.

The market cap of all companies listed on the Bombay Stock Exchange touched 4 trillion dollars.

This puts India among the top five countries to achieve the feat. India is only behind USA, China, Japan and Hong Kong with a market cap of more than 4 trillion dollars. US leads the global chart with a market cap of about 46 trillion dollars.

China is placed second with 10 trillion dollars. Japan occupies the 3rd place with 5.5 trillion dollars. Hong Kong comes fourth with a market cap of 4.7 trillion dollars, followed by India.

Market cap is different from the Gross Domestic Product or the GDP of an economy. GDP of a country is the total value of goods and services produced during a financial year. India is still not a 4 trillion dollar GDP nation.

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Meanwhile, global broking major CLSA has predicted India to become the world’s top economy by 2052 with a nominal GDP of 45 trillion dollars.

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