As hope for the nation’s economic future grows, India’s stock market valuation has surpassed Hong Kong’s to rank seventh globally.

Data from the World Federation of Exchanges shows that as of the end of November, the total market capitalization of the National Stock Exchange of India was $3.989 trillion, while Hong Kong’s was $3.984 trillion.

On Tuesday, the Nifty 50 index for India hit yet another record high. It is on track for its seventh consecutive year of increases, having increased by 16% thus far this year. The benchmark Hang Seng index for Hong Kong, on the other hand, has fallen 17% so far this year.

Among the Asia-Pacific markets this year, India has been particularly noteworthy. The nation’s stock markets have experienced a surge due to a decrease in U.S. Treasury yields, improved dynamics in the global macro environment, and more liquidity and local participation.

The most populous nation on earth will also hold general elections in 2019; many believe the ruling nationalist Bharatiya Janata Party may win again.

“For the general election, opinion polls and recent state elections indicate that the incumbent BJP-led government may secure a decisive win, which could trigger a bull run in the first three to four months of the year on expectations of policy continuity,” HSBC strategists said in a client note.

According to HSBC, the industries with the best prospects for 2019 are banking, healthcare, and energy.

While utilities, chemicals, fast-moving consumer goods, and retailers are among the industries that HSBC has classified as unfavourable, other sectors that are comparatively well-positioned for 2024 include real estate, telecoms, cars, and real estate.

A fourth year of losses is about to begin for Hong Kong’s Hang Seng index, which is the worst performance among the main Asia-Pacific equities markets.

Moody’s downgraded its assessment of Hong Kong last week, noting the city’s institutional, financial, political, and economic links to mainland China, and moving it from stable to negative. Shortly before that downgrading, Moody’s changed its assessment of China’s government credit ratings from negative to stable.

The Hong Kong government revised its GDP growth prediction from the 4% to 5% forecast in August and stated in early November that it now expects the economy to grow 3.2% in 2023.

The administration of the city has issued a warning, stating that the ongoing effects of tight financial circumstances and rising geopolitical tensions are being seen in investments, products exports, and consumer sentiment. Hong Kong has likewise seen a decline in consumer confidence.

“Hong Kong’s economy is poised for a soft landing in 2024 as annual real GDP growth moderates to around 2% from 2023′s 3.5%,” said economists at DBS.

“Central to this recovery is mainland tourism revival, fortifying retail and catering sectors.”

For 2023, China has set a 5% growth objective. With a GDP of 4.9% in the third quarter, expectations are raised that the second-biggest economy in the world would either meet or surpass projections.

(Adapted from MoneyControl.com)