There are a number of factors that affect the Indian Stock market. Some factors affecting Indian stock market can be controlled while there are others that may take time to be controlled. Economy’s health has indicators, the share market is one of them. Any up or down in economy influences the share market like slowness in the economy. There are certain economic factors which bring a notable change in the evaluation of stocks.
Among them, inflation or deflation, changes in interest rates, happening in global market, and confidence with expectations are the notable ones. Stock prices are affected by a number of factors or events, some of which create impact on stock prices directly, another factor that do so indirectly. If a trader is new, it is better to refer stock tips to take the right decision at the time of sudden changes in stock price.
Changes in economic policy are among the factors affecting Indian stock market if the new government come into their existence, they may launch new policies, new rules, regulation in the market; this will affect cost of items. Market trends can affect investor’s mindset market trends movement of market that is mainly two types bull market and another is bear market. Any investor makes his mind to buy and sell a stock after considering these market trends.
Bull market is a strong market where stock prices are rising it will increase investor’s confident to trade. It is a sign of economic growth, recovery as well as it also develops a trader mindset to invest more in market. Bear market It is a weak market where stock costs are falling continuing it is just opposite to bull market. It often happens when there is a recession in the economy, the unemployment rate is high and prices are increasing rapidly.
Markets are confused as Indian markets are following Dow Jones and Europe markets Indians are not strong enough to withhold any problems arising in international markets. Foreign institutional investors are driving Indian markets. Demonetisation of Indian currency are running with liquidity problem in economy, which will disturb their businesses as restricted money with public. In India, markets are trading at a higher price earning multiple comparing to annual growth in businesses.
The rising fear in the minds of the people due to demonetization scheme, lack of cash and turmoil in economy because of the less cash available to carry out transactions. Lower forecast for the estimated GDP growth rising yields from the bonds in the US. Stronger dollar as per compared to Rupee which in turn increases the costs of imports, and fear about the policies set are factors affecting Indian stock market. With a way people maybe consuming goods that are brought to market this may affect the Indian stock market. For example, if there are more demands of the goods from people, then you find that the stock is not enough to supply to customers. Then you find that the Indian stock market is affected because there’s less supply than demand.