The Share Market, these two very words rule the basic pulse of the investors, the numbers going up and down and with it the very pulse of the shareholders. What a game to play but indeed a dangerous one, some people even invest their entire life’s savings here and you can’t guarantee the returns. As we all know during Pre-Liberalization the Middle Class was very much oblivious to the Sensex, actually they felt it was beyond their reach and things like the Share Market was confined mainly to the elite. However, as and when the Government of India introduced its new economic policy of LPG(Liberalization, Privatization and Globalization) things began to change. Private sectors became strong ,Foreign Institutional Investors came in, there were mergers and acquisitions globally. Business Journalism also prospered and people began to know more about the Market and its trends and traits. The middle class and the lower middle class invested more notably in the market. There was a boom and the Sensex even reached the 25K mark. It was also haunted by the Harshad Mehta Scam followed by the Chetan Parekh scam. There are so many factors that determine the rise and fall of shares of the different companies listed in the SENSEX and the NIFTY. For instance, if a giant MNC takes over an Indian firm or initiates a Joint Venture with it, where the prospects are conducive, then their share prices would go up. Here, the rumours also play a key role, if there is a rumour in the market of such acquisition or venture or for that matter even a potential merger then also there are chances that the share prices of the companies involved would go up. A prospective development in the Business Environment also aids the Market like ONGC or RIL finding a new Oil field somewhere or FMCG (Fast Moving Consumer Goods) major like HUL getting a new market. Airtel’s Zain Acquisition was also helpful to the Market. Ups and downs in the business scenario abroad also affects the Sensex and the Nifty.
The current scenario of the Share Market is even more volatile, due to the number of scams that rocked the nation in the year 2010 and the political instability where the parliament sessions were disrupted after the opposition walked out demanding a JPC (Joint Parliamentary Committee) many foreign investors are unwilling to invest in such state of affairs. On top of that the rise in crude oil prices, the oil marketing companies like IOC, HPCL and all are incurring losses in providing petrol at subsidized prices to the people, they are still incurring a significant amount of loss even after the recent rise in petrol prices. The Government has also raised the subsidies to be provided by the upstream Oil exploring companies like ONGC and OIL Ltd to the oil marketing companies so that their loss burden is alleviated. As we know that ONGC and Oil are profit making companies with ONGC being the flagship oil explorer of the country. An ideal scenario would be when there is a bullish trend in the market, investments are coming in, investors are pumping in money,people are buying more and more shares, all this will have a positive impact on the market and the Sensex will go up. Sensex is also affected by political trends .When the 24 years old Communist rule ended in Bengal and TMC won the elections, Congress won in Assam and Congress led UDF won in Kerela ,where also the Communists lost the elections though by a very small margin,the Sensex did gain a few points. The Sensex looks up when there is a pro-liberalization and stable government at the centre and also in the respective states. In my opinion a long term investment can serve well for the investors and obviously the Bullish trend and not the Bearish trend. I feel Bullish tendency can benefit a large number of investors whereas Bearish is a negative trend for the market and gainers are very few. In fact, today the Sensex Slumped by 192 points and the Market experts say that the trading sentiment was bearish amid a browbeaten trend on global markets following weak US economic data.
The current scenario of the Share Market is even more volatile, due to the number of scams that rocked the nation in the year 2010 and the political instability where the parliament sessions were disrupted after the opposition walked out demanding a JPC (Joint Parliamentary Committee) many foreign investors are unwilling to invest in such state of affairs. On top of that the rise in crude oil prices, the oil marketing companies like IOC, HPCL and all are incurring losses in providing petrol at subsidized prices to the people, they are still incurring a significant amount of loss even after the recent rise in petrol prices. The Government has also raised the subsidies to be provided by the upstream Oil exploring companies like ONGC and OIL Ltd to the oil marketing companies so that their loss burden is alleviated. As we know that ONGC and Oil are profit making companies with ONGC being the flagship oil explorer of the country. An ideal scenario would be when there is a bullish trend in the market, investments are coming in, investors are pumping in money,people are buying more and more shares, all this will have a positive impact on the market and the Sensex will go up. Sensex is also affected by political trends .When the 24 years old Communist rule ended in Bengal and TMC won the elections, Congress won in Assam and Congress led UDF won in Kerela ,where also the Communists lost the elections though by a very small margin,the Sensex did gain a few points. The Sensex looks up when there is a pro-liberalization and stable government at the centre and also in the respective states. In my opinion a long term investment can serve well for the investors and obviously the Bullish trend and not the Bearish trend. I feel Bullish tendency can benefit a large number of investors whereas Bearish is a negative trend for the market and gainers are very few. In fact, today the Sensex Slumped by 192 points and the Market experts say that the trading sentiment was bearish amid a browbeaten trend on global markets following weak US economic data.
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