Here are 5 reasons why markets have fallen 7% from all-time highs- A look at key trading approach now

The Indian equity markets have fallen 5.7% in the last one month and the Nifty is down 7% from an all-time high of 26,277.35 on the back of sub-par corporate earnings and China’s stimulus push. Well, let’s pause and take note of the stupendous run thus far. From last Diwali to current levels, the Nifty has run up from levels below 19,000 last November to levels above 26,270 in September. Barring a few pauses in between, that’s a 38% plus upmove in less than a year.

While the markets take a breather, let’s probe if there is any reason to worry? “It is the correction phase,” said Ajit Mishra, Senior Vice President of Research at Religare Research.  Well most analysts say this is more of a deep correction and till the time the Nifty sees a correction more than 10%, it isn’t really a bear zone. 

Why are markets falling: 

Earnings concerns: The IT sector earnings fell a bit short of expectations in the second quarter hurting the markets. TCS, the largest IT services company’s net profit came below the street’s expectation. Infosys reported a net profit of Rs 6,506 crore but was below the estimates of Rs 6,700 crore. “Disappointing start of earning season are the key reasons,” added Mishra. 

China Factor: China’s economic stimulus to revive its economy isn’t playing well for Indian markets. The People’s Bank of China has slashed the five-year loan prime rate (LPR), a key lending rate in China, to 3.6% from 3.85% and the one-year loan prime rate to 3.1% from 3.35%. This is instrumental in redirecting a lot of foreign flows to China. “China is recovering, incrementally global investors are moving there,” said Sunil Jain, Senior Vice President of Derivatives and Alternative Research at Elara Capital. 

West Asia on fire: The ongoing conflict in West Asia between Israel and Iran has impacted sentiment too. Typically, we have seen in such cases that the funds are diverted to safe-haven investments like gold. Crude prices too have been tumultuous as a result and overall sentiment has been muted.

US Election: Investors are on the edge ahead of the upcoming US Presidential elections. The market mood is divided between the implications of a democratic and republican win. While a strong win by the Republicans would mean that there could be a larger increase in trade tariffs in combination with fiscal stimulus, 

 » Read More

Related Articles

Housing prices to rise at moderate pace in FY2025-26: Should you buy now or wait?

If you’re planning to buy a home in the ongoing financial year, here’s a reality check. Property prices will keep going up, though at a moderate pace, according to a report. After two years of double-digit growth, real estate rates are now set to rise at a steadier pace of 4-6% annually, according to a

Bharat Forge acquires AAM India Manufacturing in a Rs 746 crore deal

Manufacturing company Bharat Forge has acquired AAM India Manufacturing for Rs 746.4 crore. The acquisition includes the takeover of Rs 189.4 crore cash on the books of AAM India Manufacturing. The company will have a 100% stake in AAM India Manufacturing after the acquisition.  In an exchange filing, Bharat Forge said that earlier in the

Motilal Oswal bullish on INOX Wind: 3 growth catalysts point to 21% upside

Motilal Oswal has initiated coverage on INOX Wind (IWL) with a Buy call and a price target of Rs 210, implying about 21% upside from current levels. The brokerage in its report noted that IWL is one of the few home‑grown wind energy OEMs that handles “end‑to‑end solutions from conception and commissioning to O&M”. Its four factories can

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

0FansLike
0FollowersFollow
0SubscribersSubscribe
- Advertisement -

Latest Articles

Housing prices to rise at moderate pace in FY2025-26: Should you buy now or wait?

If you’re planning to buy a home in the ongoing financial year, here’s a reality check. Property prices will keep going up, though at a moderate pace, according to a report. After two years of double-digit growth, real estate rates are now set to rise at a steadier pace of 4-6% annually, according to a

Bharat Forge acquires AAM India Manufacturing in a Rs 746 crore deal

Manufacturing company Bharat Forge has acquired AAM India Manufacturing for Rs 746.4 crore. The acquisition includes the takeover of Rs 189.4 crore cash on the books of AAM India Manufacturing. The company will have a 100% stake in AAM India Manufacturing after the acquisition.  In an exchange filing, Bharat Forge said that earlier in the

Motilal Oswal bullish on INOX Wind: 3 growth catalysts point to 21% upside

Motilal Oswal has initiated coverage on INOX Wind (IWL) with a Buy call and a price target of Rs 210, implying about 21% upside from current levels. The brokerage in its report noted that IWL is one of the few home‑grown wind energy OEMs that handles “end‑to‑end solutions from conception and commissioning to O&M”. Its four factories can

Central govt pensioners will get LTC benefit like serving employees? Here’s what Centre says

Will government pensioners be able to avail the benefit of “LTC” (Leave Travel Concession) even after retirement? This question has been in discussion for some time and now the response of the central government has also come to the fore. The central government has come out with a formal statement for the first time on

Paras Defence bags Rs 22 crore order from French defence firm, Cerbair

Paras Defence and Space Technologies has received a letter of intent for an order worth Rs 22.21 crore from the French defence company Cerbair.  In a filing exchange, Paras Defence said that it has received the Letter of Interest for 30 units of  CHIMERA 200, an anti-drone technology.  ALSO READIREDA accelerates clean energy financing in