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China and Hong Kong stocks lost nearly $5 trillion in 3 years — more than India’s market cap

MUMBAI, MAHARASHTRA, INDIA – 2024/02/01: A circular metal logo with words ‘This signal indicates buying of shares’ is viewed shut to the pavement of a road shut to Bombay Stock Substitute (BSE) in Mumbai.

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Stocks in China and Hong Kong equipped off a huge $4.8 trillion in market capitalization since 2021, which in step with HSBC, is more than the price of the Indian stock market.

The statistic doesn’t bode properly for both China or Hong Kong, especially when the National Stock Substitute of India has easiest grown in some unspecified time in the future of the same length.

The NSE overtook Hong Kong Stock Exchanges and Clearing to become the fourth biggest on the earth in January, in step with knowledge from the World Federation of Exchanges, and the total listed stocks are price a mixed $4.63 trillion, making it the third biggest in Asia.

This is indicative of how a lot traction Indian stocks contain won within the outdated couple of years, in distinction to declines in every China and Hong Kong.

Mainland China’s CSI 300 index has fallen for 3 straight years, closing out with declines of 11.4% last year. Hong Kong’s Cling Seng index performed even worse, with 2023 as its fourth consecutive decline ending the year 13.8% decrease. Both were the backside performers amongst fundamental Asia-Pacific indexes last year.

HSBC’s overview when in contrast India’s NSE — its top market by dimension — to the Shanghai Stock Substitute and Hong Kong’s HKEX.

China worries hit Hong Kong markets

China’s beleaguered property sector has been a supply of anguish for merchants, which has moreover affected Hong Kong. Many Chinese language loyal estate stocks along with Evergrande Neighborhood and Nation Backyard are listed on the HKEX.

China feature its direct aim at 5% for 2024, however analysts had been skeptical of the sphere’s 2d-biggest economic system assembly the imprint. S&P World Rankings acknowledged last week that it expects China’s GDP to grow 4.6% in 2024, slower than the 5.2% price for 2023.

“Our forecast components in persisted property weak point and modest macro policy enhance. Deflation stays a menace if consumption stays dilapidated and the authorities responds by extra stimulating manufacturing investment,” Louis Kuijs, Asia-Pacific chief economist at S&P World Rankings, wrote in a shopper present.

Aged HKEX CEO Nicolas Aguzin told CNBC in March that lack of self perception in China, high hobby charges and geopolitics are all impacting valuations and reducing the number of fresh listings on the alternate.

India: An investor favourite

Indian stocks contain rallied amid broader optimism referring to the nation’s direct. The nation’s benchmark Nifty 50 index has risen for eight straight years, registering beneficial properties of 20% in 2023.

Analysis from HSBC moreover showed that India’s National Stock Substitute has overtaken the Shanghai Stock Substitute to become the 2d biggest globally by month-to-month transaction volume. Then again it aloof lagged the Shenzhen Stock Substitute which took the pinnacle put.

Indian stock exchanges moreover noticed basically the most preliminary public choices in 2023, in step with overview from EY India. That is despite a subdued atmosphere for IPOs, especially in Asia. India noticed 220 IPOs last year, raising $6.9 billion in proceeds, in step with EY. That is a forty eight% soar in deal exercise from 2022.

“While China’s market has a good deal slowed, India has emerged as a standout performer,” acknowledged George Chan, EY global IPO chief, in a separate overview report.

Deals in India made up simply 6% of IPOs globally in 2019, however Chan acknowledged the nation now accounts for 27% as of basically the fundamental quarter, “propelling it to the gap of the sphere’s main IPO market by deal volume.”

In distinction, EY knowledge showed there were 30 IPOs in China’s A-share market in basically the fundamental quarter, raising $3.4 billion. That is the fewest number of IPOs and smallest proceeds since 2020. Hong Kong had simply 10 IPOs in some unspecified time in the future of the three-month length and easiest two crossed $100 million in deal dimension, for the lowest proceeds since 2010.

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