NSE loses trillion-dollar market cap tag, BSE a whisker away
The double-whammy of declining rupee and stock valuations is hitting the markets hard
A sharp plunge in rupee to record low below Rs 56-level today cost the top stock exchange NSE its trillion-dollar market capitalisation tag, while another bourse BSE managed to hold onto this status just by a whisker.
Hit by the double-whammy of declining rupee and stock valuations, the cumulative market value of all the companies listed on the National Stock Exchange (NSE) today dipped to $999 billion (Rs 55,95,326.34 crore).
However, BSE managed to hold on to the trillion-dollar level by a small margin, largely due to a larger number of the companies listed on this exchange as compared to the NSE.
At the end of today's trade, the cumulative market value of all the BSE-listed companies stood at $1.02 trillion (Rs 57,16,511.87 crore).
The Indian stock market, in terms of cumulative valuation of companies listed on both the BSE and the NSE, had briefly lost its trillion-dollar status last in December 2011. At that time also, the fall in rupee value was the key factor behind the market valuation slipping below $1 trillion level.
There are only about a dozen countries in the trillion- dollar stock market club, including US, UK, Canada, Australia, Hong Kong, South Korea, China, Japan, Germany and France.
The Indian market had first achieved a trillion-dollar size about five years ago on May 28, 2007, but moved out of this coveted league about a year later on July 1, 2008.
India again joined this elite club of markets with trillion-dollar valuation about a year later on June 3, 2009.
The Indian market was, in fact, seen inching towards the two-trillion dollar mark at least twice in the past -- first in early 2008 and then at the beginning of 2011 with a size as high as USD 1.9 trillion.
Rupee has been on a sharp downtrend for past few days and it hit a record low of Rs 56.21 against the US dollar today, before settling for the day at Rs 56. The Indian currency had closed yesterday at Rs 55.39 yesterday.
Largely on account of declining rupee value and the flight of foreign investments, the stock market also continued its downward journey today and the benchmark indices Sensex and Nifty lost 78 and 25 points respectively.
The total market value of the BSE-listed companies dropped by $16 billion today, from yesterday's level of $1.036 trillion (Rs 57,41,522.06 crore), while the loss for NSE-listed companies was about $ 15 billion from $1.014 trillion (Rs 56,21,153.7 crore).