On Monday, the stock market witnessed a decline for the 7th consecutive day. This is the first time after March 2023 that the stock market has seen such a continuous loss. But this series of losses has not stopped yet. If we look at the data, Sensex has fallen by 3.75 percent in 7 trading sessions. On the other hand, the main index of National Stock Exchange, Nifty, has fallen by more than 4 percent. The special thing is that stock market investors have suffered a loss of Rs 23.50 lakh crore in these 7 days.
On the other hand, experts predict that there will be further decline in the stock market in the coming days. The main reasons for which are Fed’s stance on interest rates, rise in dollar index, second quarter earnings of companies, rising inflation figures and withdrawal of FIIs can harm the stock market. Let us discuss this in detail.
There was devastation in the stock market in 7 days
There has been no less devastation in the stock market in the last 7 trading days. According to the data, for the last time in the current month, Sensex and Nifty had closed with a rise on 6 November. After that, in 7 trading sessions the Sensex has fallen by 3039.12 points. On Monday, the Sensex closed at 77,339.01 points. This means that the Sensex has seen a decline of 3.78 percent since then. On the other hand, it has fallen more than 10 percent from its life time high.
On the other hand, the main index of National Stock Exchange, Nifty, has fallen significantly in the last 7 trading sessions. The last time Nifty saw a rise was on November 6. Then Nifty was seen at 24,484.05. Since then it has seen a decline of 1,030.25 points. This means that Nifty has suffered a loss of 4.21 percent in the last trading sessions. At the same time, Nifty has fallen by about 11 percent from life time high.
huge loss to investors
If we talk about investors, a huge decline has been seen during this period. According to data, investors have lost more than Rs 23 lakh crore in the last 7 trading sessions. The market cap of BSE was Rs 4,52,58,633.53 crore on 6 November, which came down to Rs 4,29,08,846.36 crore on Monday i.e. 19 November. This means that investors have suffered a loss of Rs 23.50 lakh crore so far in 7 trading days. When Sensex was at its life time high, the market cap of BSE was Rs 4,77,93,022.68 crore. Since then, there has been a loss of up to Rs 48.90 lakh crore.
Stock market may fall due to these 5 reasons
Fed’s stance on interest rates: Recently, Nomura has estimated that the US Federal Reserve is not going to make any change in interest rates in the month of December. At the same time, a reduction of only 50 basis points is possible till June next year. After that no change will be seen till 2026. If this happens then pressure may be seen in the American stock market. Whose effect can be visible on the Indian equity market.
Rise in dollar index: No cut in interest rates by the Fed means a rise in the dollar index. Anyway, after the victory of Donald Trump, there has been a lot of strength in the dollar index. In the last one month, the dollar index has seen an increase of more than 2 percent. On the other hand, the dollar index has increased by 4.67 percent in 3 months. It is estimated that the dollar index may reach the level of 107 to 108. Due to which selling pressure may be seen in the stock market.
Second quarter earnings of companies: The second quarter figures of Indian companies have been seen to be bad, the impact of which can be seen more in the stock market in the coming days. Many companies are in loss. According to the report of research firm Jefferies, out of the 121 companies that it tracks, about 63 percent i.e. 75 companies may see a decline in profit this financial year. The special thing is that the results of the country’s companies may be bad in the coming quarters.
Rising inflation figures: Rising inflation figures in India may bring the stock market under further pressure. In the month of October, the country’s retail inflation reached a 14-month high of 6.21 percent. Which is likely to be around 6 percent in the month of November. This means that inflation may trouble the country further in the coming months and a decline may be seen in the stock market.
FII Withdrawal: Although the withdrawal of money from the Indian stock market by foreign investors may have slowed down a bit, there is no sign of any hindrance in it in the coming days. Even on Monday, FIIs have withdrawn about Rs 1,500 crore from the stock market. So far in the month of November, foreign investors have withdrawn Rs 23,913. On the other hand, in October and November together, foreign investors have withdrawn about Rs 1.18 lakh crore from the stock market.
