Thursday, January 13, 2022

Why Stock Market rising despite Omicron??

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The current situation is a good example of this. The day-to-day rise in the stock market is a mystery to the common man as we are still not out from the Corona tragedy and which is still on a rise in some part of IndiaBut remember, the stock market is rooted in emotions. It is always looking to the future. With every up and down in the stock market, are predictions of what will happen in the future. In the month of March when the COVID 19 crisis started in India, the stock market crashed sharply.

It was a symbol of the damage that would cause in the near future because of the Corona pandemic.But it was only when the same market was started rising despite locked down in April and Carona's crisis in the country escalated. Many had thought that the Nifty would go down to 5000-6000 but the Nifty settled at 9800 after 8500. The Nifty jumped 30% from the bottom in April. This is because even though FIIs are withdrawing their money from the market, Indian investors have continued to invest. They continue investing in SIP. Those who had extra funds kept pouring money into the market.

Investors have been very cautious and alert since the 2008 crisis. If they invest in the stock market for long-term financial goals, they see this kind of fall as an opportunity. Today, ordinary investors are investing in the hope that India's economic growth will continue in the future. Today, the Indian stock market does not rely entirely on FIIs. The money of the common man as well as institutional investors are invested in the market in a big way. Just as the market responds by recognizing what will happen in the future retail investors do the same.Currently, after almost 11 months market is literally doubled from the 23rd march lowest because of the great results shown by the companies as well supporting budget from the government. FIIs are back in the market giving an upward push. This seems a sustainable bull run.There are strong reasons for v shape recovery which the market showed. One of these was India has handled the Carona crisis better than the rest of the world.

Investors know that recession may not have been caused by the economic crisis but by the health crisis. If the health crisis ends early, the economy could get back on track.Government has a keen interest in taking concrete and constructive measures to revive the economy instead of just cosmetic touch up.Many sectors adopt digitalization very fast and restructure themselves to sustain in this crisis and manage to grow also.But we are still not come out of a difficult time yet. The damage done to the economy by the Corona crisis is profound. The ground reality is often not reflected in the stock market. This is because Sensex represents only the top 30 companies where nifty has the top 50 companies. These companies are big and know how to manage a crisis. So actually there is no direct connection with an overall economy and share market buy yes Share market shows sentiments of people of that country. It bets of future so bear and bull market can indicate growth or recession which economy may face in future.
It is very hard to predict the market. A retail investor really can not TIME the market. Among us, there are many who missed this bull run and now repenting. If your financial goals are of long-term, in any market condition the general investor should continue his/her SIP in the equity mutual fund and follow the asset allocation strategy required for each and every goal.In this bull run also Invest in good companies if you see the right opportunity. A well-thought-out investment plan will surely pay off in the long run.

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