Dalal Street Lags as Global Markets Hit Record Highs on AI Rally
Global stock markets touched fresh record highs on 27 May, powered by a surge in AI-linked technology stocks and stronger-than-expected corporate earnings. India’s Dalal Street, however, is moving in the opposite direction, and the gap between Indian and global markets is widening fast.
South Korea tells the starkest story. The KOSPI has soared from the 2,000-point range to above 8,000 within a year, driven largely by a global semiconductor boom fuelled by rising AI demand.
On 27 May, the index closed at a record 8,228.70, up 2.25% for the session. Samsung Electronics and SK Hynix led that charge. Japan’s Nikkei has also added 25% this year.
In the US, the Dow Jones closed at a record 50,644.28 on 27 May, while the S&P 500 edged up to 7,520.36, a second straight closing record.
The Nasdaq has rallied strongly in recent months on the back of chip stocks like Nvidia, though it pulled back slightly on 27 May as investors paused after a sharp run-up.
Back home at the dalal street, the Nifty 50 is down nearly 9% year-to-date in 2026 and the BSE Sensex has shed around 11% in the same period. India has fewer listed companies with direct AI exposure compared to markets like the US, South Korea and Japan.
Market participants say this has kept foreign money flowing out of Indian stocks and into markets where AI plays are easier to find.
Crude oil is the second pressure point. Tensions in West Asia have kept energy markets volatile and oil prices elevated. For India, which imports most of its oil, higher crude prices push up inflation, raise costs for companies and weigh on the rupee.
Sectors like automobiles, aviation, paints, logistics and consumer goods are feeling that cost pressure the most.
On the domestic earnings side, Q4 results have been a mixed bag. Profit growth has come in better than revenue growth for many companies, but weak sales numbers suggest demand across the broader economy remains soft.
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