The significant rebound in shares of Adani Group in the past week has helped India regain its place among the top 5 stock exchanges in the world.
This comes after India lost its seat to France after the US short seller’s report, “Hindenburg Research” in January, accusing the “Adani” group, which has diversified businesses in the ports and energy sector, of “brazen stock manipulation” and “accounting fraud,” according to what he said. Bloomberg reported. The allegations led to sales of “Adani” shares, which led to a sharp decline in the indices, according to what was seen by Al Arabiya.net.
However, as of May 26, the market capitalization of shares reached $3.3 trillion in India, driven by inflows of foreign money into Indian stocks – and the sharp rebound in Adani shares.
Foreign investors have bought $4.5 billion worth of shares in May so far, a little more than double from last month, according to India’s National Securities Depository. The entities listed in Adani added about $15 billion to their market capitalization last week, to offset some post-Hindenburg losses.
France left the top five again after the country’s stock indices lost more than $100 billion in market value last week. The reason for this was the sale of shares of luxury goods companies such as “LVMH”, “Vivendi”, due to fears of a slowdown in China and the United States.
Investors choose India over China
India as one of the world’s fastest growing economies looks alluring.
On the other hand, rival China seems to have taken a back seat due to the ailing economy. Economists say that Beijing’s isolationist policies over the Covid pandemic, the turmoil in its real estate industry, and the harsh antitrust campaign against the country’s valuable technology companies have crushed sentiment towards Chinese assets.
For his part, Mobius Capital Partners founder and market expert Mark Mobius sees India as a viable alternative. “You have a billion (Indian) people, they can do the same thing that the Chinese do. They can do the same kind of manufacturing and so on.
While the strategic analyst in the “Jefferies Financial” group, Christopher Wood, last week increased the weight of Indian stocks in his portfolio in the Asia-Pacific region.