Look at the devastation of the stock market, Rs 50 lakh crore lost in 50 days, will it be compensated in the next 50 days?

In less than two months, Rs 50 lakh crore was wiped out from the stock market. The main reason for this is the recovery of stock market profits by foreign investors. They have withdrawn more than Rs 1 lakh crore so far in the months of October and November. The stock market has fallen more than 9,000 points from its all-time high. On the other hand, a similar situation is being seen with Nifty. Now the most important question is what will the next 50 days be like? Will the stock market be able to recover this loss in the next 50 days? Will Sensex and Nifty be able to surpass their lifetime high and set a new record in the next 50 days?

These questions are also important because there has been a decline in the rate at which foreign investors were withdrawing money from the stock market. On the other hand, Donald Trump, who achieved a historic victory in the US elections, may not have been sworn in as president, but he has begun to give his economic and political indicators. So the conditions of the global stock market will change completely. The United States is facing problems due to tariffs imposed on China, the strength of the dollar and mutual trade between India and China. All these things will affect the Indian stock market in the coming days. Let’s try to understand why the next 50 days are important for the Indian stock market.

Loss of Rs 50 lakh crore in 50 days

The devastation of the stock market can be gauged from the fact that Sensex and Nifty have seen a huge decline during this period. Due to which investors have lost Rs 50 lakh crore. On September 27, when Sensex was at its peak i.e. lifetime high, the market capitalization of BSE was Rs 4,77,93,022.68 crore. While on November 18, Sensex reached less than 77 thousand points and the market capitalization of BSE is close to Rs 4.27 lakh crore. This means that during this period, Rs 50 lakh crore of BSE’s market capitalization has been lost. This is the loss of stock market investors.

How much did Sensex and Nifty fall?

A drop in the stock market is also seen on Monday. While Sensex has fallen by more than 600 points and Nifty has fallen by more than 180 points. If we talk about the last 50 days, a huge drop has been seen in the stock market. On September 27, the Sensex had reached an all-time high of 85,978.25 points. Since then, Sensex has seen a decline of 9,013.19 points or 10.50 per cent. If we talk about Nifty, it had reached its all-time high on September 27 with 26,277.35 points. In this situation, during this period there has been a drop of 2,926.95 points, that is, 11.13 percent. Now the most important question is whether there will be a stock market rally in the coming days.

Destruction caused by foreign investors

The main reason for this devastation in the stock market is the exodus of foreign investors from the stock market. They have withdrawn more than Rs 1.16 lakh crore in about 50 days. A record profit of Rs 94,017 million was made in the month of October. In the month of November, Rs 22.42 billion have been withdrawn so far. This is also a record in itself. Never before have foreign investors withdrawn such a large amount from the stock market in such a short time. Experts believe that the valuation of India’s stock market has become much higher than that of other emerging stock markets in the world. So foreign investors now obtain clear benefits. However, last week the pace of profit-taking by foreign investors was much slower than in previous weeks. Which was only Rs 2,500 crore, while in the first week a withdrawal of Rs 20,000 crore was observed by foreign investors. This sluggishness can be considered a better sign for the Indian stock market.

How can the stock market be in the next 50 days?

1. Vipul Bhowar of Waterfield Advisors said in a media report that the RBI and SEBI have prepared a new framework to reclassify foreign FPI as FDI. Therefore, a positive impact can be observed on foreign flows to India. The new framework will be more flexible for foreign investors and will remove obstacles to their entry.
2. With the new rules, FPIs can have a greater participation. This creates opportunities to increase foreign investment in Indian companies without the need for immediate disinvestment, especially in mid-cap companies, and helps attract long-term capital. Whose positive effect can be seen in the stock market.
3. On the other hand, the policies of the Trump administration are also going to be very important. US resentment toward China is likely to increase. In such a situation, India will be an important South Asian country for the United States. On the other hand, in addition to promoting foreign investment, the closeness of Trump and Narendra Modi will also monitor how much and how trade is between China and India.
4. On the other hand, experts say that if profit booking by foreign investors is stopped, even if the investment is negligible, there is still a possibility of an increase in the stock market due to investment by domestic investors. Dr. Vikas Gupta of Omniscience Capital said in the media report that apart from this, as clarity begins to emerge in the Trump administration’s policies, FII flows are likely to return to developed and emerging markets. .
5. For the first time since 2020, India Inc’s second-quarter earnings season has been poor. Due to which there is a fall in the shares of the companies. Experts believe that the third quarter numbers will be better and the fourth quarter will be strong. So there is every possibility of a rise in the stock market.