Will the stock market crash again in 2020?June 9, 2020
A stock market crash is possible. We have seen the impact of COVID-19 on the stock market crash and the fall of the stock market which happened.
“We are going through a period of unprecedented uncertainty. The inability to visualise duration, economic impact (of lockdowns due to coronavirus), global downtrend and uncertainty have led to markets spiralling downwards. To gauge the time to recovery, one has to have a sense of India after Covid-19. The impact on businesses (micro, small, mid & large), consumption, demand (internal and external), jobs will have a bearing on the economy,” says Prashant Joshi, Co-founder and Partner, Fintrust Advisors LLP.
Markets run ahead of time. Coronavirus is creating havoc in Europe and the US, major drivers of the global economy. So far, India has remained relatively less impacted than the rest of the world, though the number of infected is expected to rise in the coming days. The market has factored in the worst. The only uncertainty is around the longevity of the lockdowns, both globally and in India. “This time, circumstances are a little different. We have never witnessed a pandemic in living memory, hence no one is sure about how long this will last.
And if things deteriorate significantly, we may see another sharp correction. Otherwise, the markets may remain range-bound, till they see some signs of normalcy. As per Tim Ord of Phillip Capital, up to 90 per cent correction is over. He says the correction may continue till July when Nifty may see 7,000 levels.