After five straight months of decrease, India's market capitalization has increased by 9.4 percent in dollar terms in March. This is the strongest monthly increase in four years, and it places India as the best performer among the world's ten largest equities markets.

The total market capitalization of all listed companies on the BSE is over $4.8 trillion, up from $4.39 trillion at the end of February, according to exchange data. Since May 2021, this growth increase has been the fastest.

Japan and Hong Kong experienced increases of 4.9 and 4%, respectively, while Germany followed with a 5.64 percent growth in market capitalization to over $2.81 trillion. China's growth was 2.2%, France's was 2.7%, the UK's was 2%, and Canada's was 0.44 percent.

In contrast, the US equities market, which is the largest in the world and is worth $59.13 trillion, experienced a 3.7% decline in the same time frame. Saudi Arabia too recorded a decrease of 4.4%.

The primary indices, the Sensex and Nifty, both rose 5% in March, demonstrating the enormous strength of the Indian stock markets. Even stronger were broader indices, such as the BSE MidCap and SmallCap, which increased 8.4 and 9.8 percent, respectively.

The surge is mostly driven by value buying and hopes of a rate decrease from the Reserve Bank of India. Investor mood has also been boosted by indications from the US Federal Reserve, which has forecast two interest rate decreases in 2025.

Recent lower-than-expected consumer price index inflation, which remained below the RBI's medium-term target of 4%, has fueled market expectations of a rate decrease during the central bank's impending April monetary policy review.

Analysts also predict further liquidity measures from the RBI, which will expand on recent steps to alleviate liquidity bottlenecks in the banking system. Since late 2024, the RBI has provided around Rs3 lakh crore in long-term liquidity through a combination of variable rate repo (VRR) auctions, swaps, and open market operations (OMOs).

Gaurang Shah, Senior Vice President at Geojit Financial Services, stated that markets had recovered by more than 1,100 points on the Nifty and 3,500 points on the Sensex since the beginning of March. As the end of the fiscal year approaches, investors are waiting to see what Trump will do next with reciprocal tariffs. A little correction is possible after this rally.

Short-term traders may want to take profits, while long-term investors should stay invested since further gains are conceivable if fourth-quarter earnings remain strong. While the market picture remains fluid, wise investing decisions should be based on fundamental analysis rather than brokerage suggestions, Shah stressed.