<p>Two possible explanations I have:</p>

<ol>
<li><p><a href="https://knoema.com/atlas/topics/Economy/Financial-Sector-Capital-markets/Market-capitalization-percent-of-GDP" rel="nofollow noreferrer">The stock market capitalization to GDP</a> in India, although high, is at around 70–80 percent, compared to 100+ percent for countries with more developed capital market. This means that any gains or losses in the stock market would have an average 70% impact on the economy.</p></li>
<li><p>Being one of the fastest growing markets in the world (due to its population size, urbanization, and the rise of middle income families), the market has huge potential in the years to come, and the stock market takes that into account.</p></li>
</ol>

CC BY-SA 4.0
2020-01-06T05:57:02.677Z
2020-01-06T05:57:02.677Z
Art
<p>While economy in india is experiencing a slowdown, the stock markets are having record highs. 
can someone explain this dichotomy in simple language ?</p>

CC BY-SA 4.0
2020-01-04T14:33:47.980Z
Irrational exhuberence? Though, one could expect this in boom times.
london
<gdp>
Stock market in india
George carlin
# Stock market in india

(Asked by: username_0 on 2020-01-04)

While economy in india is experiencing a slowdown, the stock markets are having record highs.
can someone explain this dichotomy in simple language ?

**Tags:** gdp

> **Comments:**
> **username_1**: Irrational exhuberence? Though, one could expect this in boom times.  

---

## 1 answers

### Answer by username_2 on 2020-01-06. Score: 1

Two possible explanations I have:

1. [The stock market capitalization to GDP](https://knoema.com/atlas/topics/Economy/Financial-Sector-Capital-markets/Market-capitalization-percent-of-GDP) in India, although high, is at around 70–80 percent, compared to 100+ percent for countries with more developed capital market. This means that any gains or losses in the stock market would have an average 70% impact on the economy.
2. Being one of the fastest growing markets in the world (due to its population size, urbanization, and the rise of middle income families), the market has huge potential in the years to come, and the stock market takes that into account.


---

