China reclaimed the top spot in the MSCI Emerging Markets Investable Market Index (EM IMI), surpassing India in September and holding the lead through October.
This marks a reversal following India’s brief reign as the largest market by weight in August.
China’s weight in the MSCI EM IMI rose to 24.72 per cent in October from 21.58 per cent in August, driven by a sharp rally in Chinese equities, while India’s weight declined to 20.42 per cent from 22.27 per cent, Moneycontrol reported.
China’s ascent back to the top spot comes amid the government introducing a series of stimulus measures to revitalise its economy.
Since its September lows, the Shanghai Composite Index has rallied over 25 per cent, fuelled by investor optimism around Beijing’s commitment to economic support.
On the other hand, India’s equity market has faced pressures, with benchmark NSE Nifty 50 and S&P BSE Sensex indices down 8 per cent September peaks.
Record foreign outflows and earnings disappointments have also dampened India’s market weight.
The divergence is also visible in both the countries’ total market capitalisation, with India’s market cap at $4.53 trillion currently, while China’s market cap is at $10.81 trillion.
The MSCI Emerging Markets Investable Market Index includes large, mid and small-cap companies and targets coverage of approximately 99 per cent of the free float-adjusted market capitalisation in each country.
This is different from the MSCI Emerging Markets Index, which targets coverage of approximately 85 per cent of the market capitalisation across large and mid-cap stocks.
Follow us on
