Global Stock Market to Hit a $127.4 Trillion Value in 2025, Still $900 Billion Less than in 2021

Although the global stock market outlook for 2024 remains positive, investors have been on a bumpy ride with periods of volatility and considerable industry and regional differences in performance over the past nine months. This volatility is expected to continue next year, causing the stock market value to remain below 2021 levels.

According to data presented by Stocklytics.com, the global stock market is expected to hit a $127.4 trillion value in 2025, still $900 billion less than three years ago.

Annual Growth Rate to more than Halve to 2.4%

Technological developments have fueled the stock market growth throughout 2023 and during the six months of this year, with tech stocks outpacing all other sectors by a large margin. However, that changed over the past two months.

After two years of unstoppable growth, the tech giants have seen their stock values nosedive triggered by the US government’s expanded export restrictions on AI chips to China, expectations of future interest rate cuts, valuation concerns, and mixed earnings reports. The investor’s optimism about the tech sector not only softened, but many of them shifted away from mega-cap stocks to industries more likely to benefit from potential interest rate cuts, mainly real estate, utilities, and financial services, which all generated double-digit returns.

The market volatility is likely to continue in the following months as investors weigh the competing forces of strong corporate earnings and economic growth against the risks of inflation, geopolitical tensions, and elevated valuations. In such circumstances, the stock market growth will slow down next year.

According to Statista Market Insights survey, the combined market cap of all stock exchanges will grow by 6.6% and hit $124.4 trillion by the end of the year, almost $8 trillion more than in 2023 and $14 trillion more compared to 2022 levels. Although the market value will continue rising and hit $127.4 trillion in 2025, Statista expects the annual growth rate to more than halve to only 2.4%, the lowest figure after the 2022 drop. That year alone, the stock market value plunged by 14% but quickly recovered to 5.6% in 2023 and 6.6% in 2024. However, that is still far from the double-digit growth rates of 30.4% and 20.6% in 2020 and 2021

US and UK Stock Markets to Stagnate, Indian Stock Exchanges to See the Biggest Growth

While US stock exchanges have a lion’s share in the global stock market, generating 38% of the total market value, they are facing a challenging year. Statista expects the US market to stagnate in 2025, with the combined value of the US stock exchanges remaining unchanged at $48.7 trillion.

UK stock exchanges will see a similar trend, with a projected $3.6 trillion in combined market cap, just as this year. The Chinese market is expected to see a modest 1.5% year-over-year growth, much less than Japan and India, the other major players in the global stock exchange landscape.

Statistics show the Indian stock market will grow by 8% and hit a $4.1 trillion value in 2025. Japanese market follows with a 5% year-over-year growth and a value of $6.4 trillion.