Indian Stock Market Rises for Third Day, Hits Consecutive Record Highs... High Growth and Expected Benefits from Chinese Regulations

Closed at 60,077.88

[Image source=Yonhap News]

[Asia Economy Reporter Lim Cheol-young] The Indian stock market closed on a three-day winning streak, continuously hitting record highs.

On the 27th (local time), the Indian Sensex index closed at 60,077.88, up 29.41 points (0.05%) from the previous trading day. The intraday high reached 60,412.32.

The Indian stock market's record-high rally is attributed to the country's high economic growth despite COVID-19 and the positive spillover effects from regulatory risks in China.

In fact, India's GDP in the second quarter grew by 20% compared to the previous year. The manufacturing PMI index has consistently shown expansion, and the export growth rate has significantly increased. In July, India's export growth rate reached 55% year-on-year, setting a new record. The investment environment is also attracting investors. Maintaining a historic low interest rate of 4%, India continues stable growth, and the Governor of the Reserve Bank of India has even hinted at the possibility of further rate cuts.

Concerns over regulatory risks in China and the default risk of Evergrande Group have acted as positive spillover effects. The Chinese government has imposed regulations on major IT platform companies since the beginning of this year. Recently, fears of Evergrande Group's default triggered foreign investor withdrawals. The financial investment industry estimates that global funds flowing into the Indian stock market this year have reached $7.2 billion.

On the 20th, Goldman Sachs forecasted that India would surpass the UK to become the world's fifth-largest stock market. Goldman Sachs analyzed, "Investors are pouring money into the Indian stock market," and "The Indian stock market could grow to a $5 trillion scale within three years."