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Stock market & economy future amid COVID-19

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Bhashkaranand Joshi
Bhashkaranand Joshi
I'm Founder & CEO of where we help independent investors and traders to find best stock broker fitting to their needs.

Coronavirus or COVID-19 family is of viruses that cause a range of illnesses in humans including the common cough and cold and more severe forms like Sars and Mers which are life-threatening. With the increase of COVID-19 cases and death worldwide the who declared the coronavirus outbreak a pandemic in the second week of March 2020.

When we have a surprise, coronavirus outbreak and the subsequent countrywide lockdown. The pandemic economy hit hard the income of all the Indian retailers selling nonessential items like a car, furniture clothes jewelry, etc. Currently, coronavirus is impacting the global and the Indian economy and stock market which is lead to massive portfolio getting washed out. Indian stock market fell by around 35% giving an opportunity for long term investors to invest in fundamentally sound companies at a discounted rate.

So, due to any kind of pandemic global market does correct sharply, there was no exception Indian markets too suck up to selling pressure and Nifty declined 35% during the recent correction. Recently a report published showed that around the 1.2 million new accounts were opened in March and April month. Stock market participants will benefit from this opportunity, especially top stockbrokers in India. Paisowala platform which helps to find the best broker has seen monthly account openings double with a stockbroker since February, with a 20% increase in first-time investors, mostly under 30 years.

For the past few years the Indian stock market has witnessed many crashes the biggest of them was in 2008-09 where was is a subprime lending crisis when the market drop by almost 60% from its peak however from 2009 stock markets across the globe recovered Indian stock markets sustain the bull run over the years. Despite a few hiccups.

The majority of companies are expecting a significant decline in revenue and job losses. The most important severely affected sector is aviation automotive and seafood. Going forward work week income growth and job losses are expected to impact demand and some products post lockdown 4. The COVID-19 crisis has triggered large erosion of demand globally resulting in a sharp decline in crude prices due to the absence of demand because of lockdown.

Recently Finance minister recently announced a 20 lakh crore rupees release package aiming and softening the effect of this destruction. This would largely benefit the unorganized sector workers especially the daily wage earners urban and the rural poor.

Impact of Crude Oil In Indian Economy

India imports more than 80% of its crude oil requirements. A significant price change in crude oil has a direct impact on India’s current account deficit hence if the oil prices continue to be in the lower range for a long period of time it will reduce India’s import bill and intern the current account deficit.

Crude oil is used as a raw material by a lot of companies. Thus a big drop in crude prices may make some manufacturing companies see positive traction as the full cost for production declines. Many Pharma companies to benefit shows demand for paracetamol and allied medicines. This pandemic has also made people realize the importance of life & medical insurance. Thus this sector can see some good order books.

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Bhashkaranand Joshi
Bhashkaranand Joshi
I'm Founder & CEO of where we help independent investors and traders to find best stock broker fitting to their needs.
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