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  #1  
Old August 24th, 2015, 06:16 AM
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Stock market crashes

The stock markets witnessed a bloodbath on Monday with the benchmark BSE Sensex crashing over 1,600 points amid a global rout.

The BSE 30-share index crashed 1,625 points to close at 25,742.

Nifty also tanked 491 points to close at 7,809.

This is the biggest-ever fall for Sensex in a day, PTI reported.

The market witnessed all-round heavy selling across realty, power, oil and gas, bankex, auto, metal, capital goods and IT sectors.

The investors lost over Rs 7 lakh crore as a result of market meltdown.

Attributing the stock market crash to global turbulence, finance minister Arun Jaitley on Monday said the government and RBI were watching the situation and hoped that things will stabilise once the transient impact is over.

"There has been for the last few days a great amount of turbulence which was being caused in the global markets. Obviously that turbulence has had impact on Indian market itself. The factors responsible for this are entirely external.

"There is not a single domestic factor in India which has either contributed to it or added to it. These are external factors. I have not the least doubt that this turbulence is transient and temporary in nature. The markets will settle down", he said.

Jaitley, who was talking to reporters on the sidelines of an event in Delhi said that government and the RBI were closely watching the situation. He also underlined the need for strengthening the economy to deal with the impact of global developments.

Jaitley also said that all the concerned authorities including the government and Reserve Bank "are watching the situation very closely and conscious of the responsibility, as what is to be done."

As far as India is concerned, the minister said "our response at this stage is very clear. We have to strengthen our own economy. We have embarked upon a path for one and quarter years... even in the midst of global slowdown India should emerge as one of the fastest growing economies in the world."

Observing that the domestic indicators were extremely positive, Jaitley said, "once these transient trends are over, markets particularly in India will settle down... they will restore back."

(With inputs from agencies)




http://timesofindia.indiatimes.com/b...w/48653123.cms
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Old August 24th, 2015, 06:18 AM
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Re: Stock market crashes

Can kalidas give expert opinion on this ??
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Old August 24th, 2015, 06:25 AM
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Re: Stock market crashes

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Can kalidas give expert opinion on this ??
acche din
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Old August 24th, 2015, 08:20 AM
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Re: Stock market crashes

Dow Jones is down by 1000 points at this time.

Sensex should come down & settle around 17k before rising. It has risen too much too soon.
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Old August 24th, 2015, 10:57 AM
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Re: Stock market crashes

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Originally Posted by ashdoc View Post
Can kalidas give expert opinion on this ??
It has been a tricky market. The market has not had a correction for a very long time (5 to 6 years) which is unusual. This correction is not unusual or startling. The market was getting frothy, and it should have been obvious.

China is going through a period of deflation. That is going to impact several assets. There will be some contagion in the US, but it's going to be lower than what most economists anticipate. My view is that S&P will head lower to around 1750.

The financial crisis of 2007-08 and the response was a generational event. At that time, we had a huge bubble in housing and in credit quality (subprime treated as prime). This time around, we don't have a real bubble in the US. There may be limited contagion to the Chinese bubble.

In India, there may have been a bubble in real estate. But the currency, INR, is one of the most economically stable currencies. It has been pronounced guilty by association (being a part of emerging markets), but Indian currency is not as flaky as renmibi. It may be a good buying opportunity for Indian government bonds.
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Old August 24th, 2015, 08:25 PM
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Re: Stock market crashes

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Old August 24th, 2015, 11:31 PM
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Re: Stock market crashes

If one were to make enuf to get by comfortably, and not have any savings or investment, one is verily happy.
Those that save, invest, count, and worry, need that additional excitement of a market drop.
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Old August 25th, 2015, 07:14 AM
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Re: Stock market crashes

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It has risen too much too soon.
That was due to business expectations from Modi Sarkar. Looks like all the NDTV coverage has made Business men rethink or at least impatient.
Also, I won't be surprised if the Swadeshi lobby starts asserting itself.
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Old September 3rd, 2015, 11:13 AM
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Re: Stock market crashes

In the global context. On a relative scale, India turns out to be the least affected economy by the slowing Chinese economy and the yuan devaluation.

What makes India resilient to these global headwinds? Here are six key reasons...

1.Unlike some other emerging markets, India's economy is driven largely by domestic consumption. Exports to China account for only 10% of our total exports.
2.India does not compete with many Chinese manufactured products in international trade.
3.The steep fall in commodity prices, particularly crude oil, is a big positive for India.
4.More than half of the emerging as well as frontier economies are in bear market phase, unlike India.
5.India's dollar debt is lower than other emerging economies. So, the risks emanating from the prospective US interest rate hike are limited.
6.At a time when the global economic engine is struggling for growth, India appears to be one of the few bright spots.

In short, India appears well-geared to handle risks emerging from the global economy. And given that India is in a relatively better position than other major emerging economies, we may see global fund managers increasing their exposure to Indian equities.

Do not take India's growth story for granted. We have many big challenges before us...

Take India's banking sector for instance. Typically, the lending activity of banks is a good proxy of overall economic growth. At 8.4% growth, bank lending is at the lowest level in 20 years (as per Economic Times). The massive build-up in non-performing assets (NPAs) is even more alarming. Indian banks have gross NPAs worth over Rs 3 trillion (4.29% of total loans). Add almost a similar amount of loans under restructuring...and you have Rs 6 trillion worth of stressed loans in the banking system. This is nothing but a reflection of the mess in the Indian economy.

When you invest, don't obsess too much over factors that drive stock prices in the short term...such as how Indian markets would react to a US interest rate hike...or how the weakening prospects of other emerging markets would shift liquidity to Indian equities...

Buffett has long maintained his view that when the market becomes fearful, it is a great opportunity to buy some solid businesses at deep discounts.
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