Why Nifty is Falling?

Many traders are puzzled by the recent downtrend in Nifty. If you want to know when the right time is to invest, it is important to understand market trends. It is crucial to invest in the stock market at the right moment. This will determine whether you make a profit and if you lose. It is difficult to trade confidently without doing thorough research. Stock traders need reliable information to make informed decisions. Understanding why Nifty fell and the reasons behind it is essential to a complete understanding of the market.

Why is Nifty falling

The trends in the stock markets are influenced by global events, as seasoned traders will tell you. The seller supply and buyer demand, fluctuations within the economy, and the political climate all affect share prices. Corona virus, a recent natural phenomenon that has swept the globe, is currently the most significant. The Corona virus, also known as COVID 19, has already affected more than 150 countries and territories in the world and continues to spread at an alarming pace. There was a sharp contraction in activity in China's manufacturing sector during February. Official reports stated that the virus had reached its lowest level ever recorded. This was a strong statement about the devastating impact of the coronavirus epidemic on the economy. The risk of stocks falling around the world has increased since then.

Global stock markets have seen a sharp decline, and investors are concerned about the economic consequences of the Coronavirus. The pandemic has prompted a sell-off in the world, and Indian markets are now feeling the brunt of the global downturn. Nifty's intraday trading reached a low of 11,036.25 in March when India was less affected by the virus. This was a 11% correction from its all-time highs. Nifty and Sensex, both equity market indices, closed 0.4% lower than their peak. This was due to the discovery of COVID 19 cases in India. The number of cases affected has now surpassed 100 and the Nifty continues to fall. The historical bottoms of the Nifty are almost reached when you subtract the 10-year yield on Nifty bonds from the earnings yield.

Some industries have been more affected by the fears about COVID 19 than others. However, all sectors, except IT, have seen a decline in value. PSU banking and metal stock saw a 4.5% drop. The drop in metal scrips was more than 2%.

Conclusion

The fear of COVID 19 is causing shock waves throughout the stock market. Nearly every industry is surrounded by anxiety and doubt, and there are steep losses that can be temporary if one gets carried away by emotions.

This could be a great opportunity to purchase stocks in high-performing industries. You must be careful not to buy large quantities at this stage. We are still in an early stage of the pandemic, but the effects are growing. It is difficult to predict how stock prices will react to fears about the spread of the virus. This is the time to be cautious and alert for any opportunities that may arise.