Impact of COVID-19 in Stock Market
COVID-19 is an infectious disease caused by a unique virus called Corona Virus. This unanticipated disease has spread worldwide from the end of December 2019. Considering the contagiousness of this virus most areas of the globe went into a Lockdown. Every small and big business has been affected due to this virus. So let us discuss how it has impacted the Indian Stock market.
PreCOVID-19 Indian Stock market Rally was limited to 8 to 10 Blue Chip Stocks like HDFC Bank, HDFC, TCS, Infosys, Hindustan Uniliver, Reliance, Kotak Bank and ICICI Bank. Because of these stocks in 2019 Sensex returned around 14%. In the start of 2020 in Mid January Nifty and Sensex were hitting their peaks at Nifty@12362 and Sensex@42217.
Ever since the COVID-19 strike, fear came in the market and it sent the world to the crashing to the levels that were not witnessed since the Global Financial Crisis of 2008. Indian market lost 27% from the levels witnessed at the start of the year. The stock market reflected the sentiments that COVID-19 as unleashed in the investors all over the globe. Companies have scaled back, layoffs multiplied and negligible growth is visible in some of the top companies for a couple of months. This crisis was different from all the fallout that the market has witnessed in the past. In the Result, RBI came up with a reduction in Repo Rate and relaxation by extending the moratorium. Still this pandemic impacted the corporate world a lot rising cases of bad loans, subdued loan growth, slugging business conditions, etc.
These crises are real and impact world economy but history is the proof that these never last long and the world is competent enough to fight these challenges and we can witness that market will bounce back soon and touch its new highs.
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