Mumbai: India lost its status as the best performing stock market in the world to China as the Chinese decision to allow greater foreign participation in companies listed on Shanghai stock exchange and additional stimulus measures undertaken to stimulate its domestic economic growth helped it to race past India during the last leg of the rally in 2014.
During the year, China’s Shanghai Composite has posted a return of 52.87 per cent as compared to 31.39 per cent and 29.89 per cent gains registered by NSE Nifty and BSE Sensex respectively. However, with India’s improving macro-economic fundamentals, experts tracking the markets said that the domestic equity markets are expected to outperform their emerging market peers in 2015.
“There has been a greater interest in the Chinese market among global investors especially after the government of China relaxed restrictions on foreign ownership of companies listed on Shanghai Stock Exchange,” said Vipul Dalal, an independent wealth and corporate strategist. According to him a slew of measures taken by China including a surprise interest rate cut by its central bank had boosted investors confidence. “Additionally, the Chinese currency has rem-ained stable, which is good from a foreign investor's perspective,” he added.
Others pointed out that the Chinese equity market picked up momentum during the second half of 2014 when its government undertook measures to boost economic growth and infuse liquidity.
