India Overtakes Taiwan to Become World's Fifth-Largest Stock Market Again

India has reclaimed its position as the world's fifth-largest stock market, overtaking Taiwan after a remarkable rally in domestic equities that has added nearly $640 billion to India's market value since late October. The turnaround has been driven by a strong return of foreign investors, easing crude oil prices and renewed confidence in corporate earnings.

The United States continues to dominate the global rankings, followed by China, Japan and Hong Kong in second, third and fourth positions, respectively. India has moved back into fifth place, pushing Taiwan down the rankings.

The country's total stock market capitalisation has climbed to approximately $5.4 trillion, restoring India to the top five global equity markets after it had slipped behind Taiwan amid a prolonged period of foreign fund outflows.

The benchmark BSE Sensex has surged 10,286 points in just 23 trading sessions, marking its fastest-ever 10,000-point advance. The rally has also pushed the Nifty 50 above the 25,300 mark, recovering sharply from levels around 22,700.

A major driver of the recovery has been the return of foreign portfolio investors (FPIs), who have turned aggressive buyers of Indian equities after two consecutive months of net selling. Foreign investors have pumped approximately Rs 65,735 crore into Indian stocks in November so far, providing significant support to the market.

The easing of crude oil prices has further strengthened investor sentiment. As a major oil importer, India stands to benefit from lower international crude prices, which can help ease inflationary pressures, reduce import costs and improve the outlook for corporate earnings.

Better-than-expected second-quarter corporate earnings and a shift in global investment flows away from technology-heavy markets have also contributed to the renewed interest in Indian equities.

However, market experts have cautioned that the extraordinary rally could face some resistance in the coming sessions, with investors likely to book profits after the sharp gains. Domestic institutional investors have also been selling shares even as foreign funds return, creating a potential counterweight to the rally.

On Thursday, the Sensex closed at 81,911.01, while the Nifty settled at 25,299.35, reflecting some consolidation after the recent surge.