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Indian equity market 3rd biggest in emerging Asia

April 22, 2009 20:31 IST

The Indian equity market has emerged as third biggest after China and Hong Kong in the emerging Asian region, with a market capitalisation of nearly $600 billion, a latest ADB report says.

According to the Asian Development Bank's 'Asia Capital Markets Monitor'report, the combined market capitalisation of all the equity markets in the Emerging Asia region stood at $5,770 billion (about Rs 290 lakh crore) at end of March 2009.

Indian equity market's capitalisation at the end of March 2009 stands at $598.3 billion (Rs 30.13 lakh crore) which accounts for about one-tenth of the combined valuation of the entire emerging Asia region.

However, People's Republic of China is at the top of the chart with a marketcap of $2,347.4 billion followed by Hong Kong with $1,293.7 billion, the data compiled in the ADB report revealed.

The other markets in the emerging Asia region are -- Indonesia, Korea, Malaysia, Philippines, Singapore, Taipei, Thailand and Vietnam.

Meanwhile the report stated, "Emerging Asian equity markets have collectively lost 51 per cent of their market capitalisation since the onset of the financial crisis, after steady and robust growth during 2003–2007."

Emerging Asia's equity markets had enjoyed a relatively long boom period that stretched from 2003 to 2007 on the back of robust economic growth and continued financial deepening.

In contrast to the emerging Asia, the developed nation United States' equity market had a valuation of a whopping $9.53 trillion at the end of March 2009, while the United Kingdom and Japan stock markets' had $1.74 trillion and $2.80 trillion, respectively, the ADB report shows.

Besides, with significant increases in market size and trading activity, many emerging Asian equity markets now boast substantial depth and volume. Turnover refers to the total value of shares traded divided by market capitalisation and provides a measure of market liquidity.

The turnover grew 54 per cent per year on average between 2003 and 2007, however, with the onset of the crisis, emerging Asian equity markets experienced a tightening in market liquidity.

In 2008, turnover at Chinese equity market had been $3.82 trillion, Hong Kong's was $1.62 trillion, while the Indian equity market had a turnover of $1.05 trillion, the report showed.

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