Tech is 41% of world markets. India's tech weight halved.

Technology (including communication services) now accounts for 41% of MSCI All-Country World market capitalisation, above the 35% peak of the dot-com bubble in 2000. The sector’s $41tn of market value is 14% larger than seven other sectors combined: staples, energy, materials, utilities, real estate, consumer discretionary and industrials.

The valuation gap underneath: tech trades at about 37× trailing earnings on $1.27tn of implied profits; the “sleeping seven” earn more, about $1.55tn, and trade at 23×. The premium has a fundamental anchor (26% sector ROE versus 14%), but concentration at this scale carries its own arithmetic: at extremes, the extreme becomes the consensus, and extrapolating it is how mistakes get made. (Data: Bloomberg, DSP; as of July 2026.)

India sits at the opposite pole of this trade. Globally, the decade’s move has been a rotation within tech: out of software, into semiconductors and hardware, the picks and shovels of the AI buildout. Semiconductor weights are up five-to-six-fold in ten years, to ~28% of the MSCI Emerging Markets index and ~15% of MSCI World. The Nifty 50’s technology exposure is almost entirely software and IT services, with zero semiconductor or hardware weight, so the AI repricing had nothing domestic to rotate into. The sector’s index share has halved from ~19% in December 2021 to 7.4%, below even its 2008 lows. (Data: Morningstar, DSP; as of June 2026.)

The dichotomy cuts both ways. India’s absence from the AI-hardware trade has been a drag on relative returns for four years and could remain one. But concentration that powers an index on the way up becomes an equally powerful drag when the cycle turns, and a market with 7% technology weight has correspondingly little exposure to that unwind.

What we’ll watch: the tech share of world market cap against its 41% reading; the software-versus-semiconductor split inside global indices; and whether Indian IT services’ earnings stabilise after their two-year de-rating.