BSE market cap Hits Rs 4.74 trillion as Indian Stocks soar in 2024

In 2024, Indian investors saw their wealth skyrocket by a staggering Rs 110.57 lakh crore, driven by a record-breaking surge in the stock market. The market capitalization of companies listed on the Bombay Stock Exchange (BSE) has surged to Rs 4,74,86,463.65 crore (USD 5.67 trillion), with the highest valuation hitting Rs 477.93 lakh crore on September 27. The BSE Sensex has gained an impressive 12,026.03 points, or 16.64%, this year, reaching an all-time high of 85,978.25 on September 27, surpassing multiple milestones along the way.

Experts attribute this sharp market rally to a combination of factors, including robust domestic liquidity, strong fundamentals of the Indian economy, and the sustained performance of midcap and smallcap stocks. "Record inflows into the mutual fund industry have contributed significantly to the liquidity boost," noted Santosh Meena, Head of Research at Swastika Investmart Ltd. Despite foreign institutional investors (FIIs) pulling back, the Indian stock market has flourished, offering substantial returns to retail investors.

At the start of 2024, the BSE Sensex was at 72,271.94 points. Now, it has soared to 84,266.29 points, marking a phenomenal rise. The midcap and smallcap indices have outperformed even more dramatically, rising by 34.32% and 34.62% respectively, contributing to the surge in investor wealth.

The recent rally was fueled by expectations of U.S. Federal Reserve rate cuts, which spurred global liquidity and improved sentiment for riskier assets. "This optimism, alongside low crude oil prices, has helped sustain India's economic growth and investor confidence," explained Meena. The 30-share BSE benchmark crossed the 83,000 mark for the first time on September 17, topped 84,000 on September 20, and surpassed 85,000 on September 25.

Global market conditions, including geopolitical stability and the beginning of an interest rate cut cycle in the U.S., further bolstered India's position as an attractive investment destination. These factors, along with relatively stable crude oil prices, have helped ease inflationary pressures and strengthened the market outlook for India.

In 2023, the BSE Sensex had surged by 18.73%, adding Rs 81.90 lakh crore to investors' wealth. The BSE crossed the USD 4-trillion mark in market capitalization for the first time in November 2023 and hit the USD 5-trillion milestone in May 2024. Reliance Industries remains India's most valuable firm with a market capitalization of Rs 19,82,265.88 crore, followed by Tata Consultancy Services (TCS), HDFC Bank, Bharti Airtel, and ICICI Bank in the top five.

Looking ahead, experts anticipate possible market corrections as global uncertainties persist, particularly with the upcoming U.S. elections and geopolitical challenges. "However, sector-specific opportunities will continue to arise, driven by India's strong domestic liquidity," Meena said.