With rising inflation and the end of global monetization policy sending Indian stocks down from the top, three charts show that pain will not end anytime soon.
The S&P BSE Sensex Index fell more than 15% from its high in October, approaching a 20% loss target for the bear market. The selloff comes as rising costs and a record decline in the rupee have forced the central bank to join international peers in raising interest rates.
India’s stock market value has already dropped by nearly 20% from its January peak of about $ 3.7 billion. The unsustainable economic situation coupled with the unprecedented migration of foreign investors and income levels seems poised to undermine the idea of a return on investment.
“We expect the markets to continue to adjust from here,” said Benaifer Malandkar, chief investment officer at Raay Global Investments Pvt. “It is expected that in the second quarter, the worst news, the Fed’s actions will be priced.”