Stock Market Rise
Stock market has been showing signs of self-correction since late 2021, where the stock market showed signs of dip going against the early rise. However, the market is changing its course and is on the rise. This steady rise may be attributed to certain factors or reasons which may have determined this stock market rise today.
Reason behind Stock Market Rising
For most part of early 2020, the market had showed signs of a slow market but the scenario started changing by the 3rd quarter of 2020 which continued till 2021, as a general principal the market correction was inevitable but that is changing too as the market is on the rise again the primary reasons behind may be because of many standing reasons:
Central Budget 2022
It is but a natural reason to react to the central budget, the market showed early signs of being wary of the upcoming budget, but after the budget announcement the economy has shown positive signs of coming back on track.
Lower Interest Rate
Banks and Government had reacted to the slow market and the pandemic and hence encouraged the investors and corporates with lower interest rates. A lower interest rates in turn makes way for high risk investment, which is the reason why the stock market witnesses a steady rise.
Absence of Discontinuing Factor
One of the major reason for the set back of the Indian market wat the lurking omicron virus variant, which made for an expected lockdown. However, the variant showed little signs of being as dangerous as it was prophesized, this avoidance of the nationwide lockdown and a steady market scenario made for a rising stock market.
Geopolitical Reason
The tension between Ukraine and Russia though is on a high, new hopes have been kindled because of talks between the nations and intermediary parties stepping in to control the situation. The Indian market like other markets shows signs of losses, and this have been much adjusted in the current situation.
Market Liquidity
Global liquidity and capital inflows by overseas investment fuelled the Indian market rise, present market strength is given by domestic institutional investors, which include mutual funds and financial institutions, amongst many.
New Investors
Given the rising number of new investors in India, the number which doubled during the pandemic and after that, had been waiting on the side-lines with their money to invest and since they have been assured that market seems stable without any hindrance from the budget or the lockdown fears. This new money have made a great difference in the market.
Stronger Corporate Earning
The economic solidity, current stability has resulted in stronger corporate earnings. This stronger corporate earning has encouraged new investors in the market and hence a better stock market with more people buying stocks than selling them.