After a brutal sell-off seen in March, the market saw a relief rally in April with the benchmark indices rising more than 14 percent as against a 23 percent correction in March.
In fact, the indices recovered more than 31 percent from March lows after falling 40 percent from its record high seen in January this year.
There are many reasons that can be attributed to the April rally such as -stability in global markets, slowing rate of new infections in major countries like US and Europe, expectations of partial opening of economies, reports of progress in finding a treatment for COVID-19, slowdown in FII outflows among others. But what hit home in effect was the liquidity after big stimulus packages announced by governments and central banks.
The picture, however, can't possibly be painted with the same brush in May, feel experts. The likely re-emergence of US-China trade tensions, delay in fiscal stimulus, actual impact of COVID-19-led lockdown once economic activity start kicking in partially, distortion across sectors in coming months among other reasons that may spoil the mood.
Experts largely expect the month to be a consolidation period for the market, though stock specific action could continue due to March quarter earnings.
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