New Delhi: As the global crisis hits investor sentiment the world over, Indian markets have taken to mirroring the Asian bourses more than the US exchanges. A study conducted by the Securities & Exchange Board of India or Sebi found this while researching the correlation between the movement of Indian, American and Asian stock markets.
Sebi member KM Abraham said while in the time of boom before the beginning of the financial crisis, the Nifty had decoupled from the US markets. It even had a 100-day period of negative correlation. It had a 40-50% correlation with the Asian markets at the same time. But the Nifty is now following its Asian counterparts. “In the period of crisis we are all huddling together in fear,” he says.
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It seems with an end to the global crisis far from sight and the world economy slowing down, investors have lost confidence in being able to take independent calls and have resorted to the opinion of the masses. As bears rule the roost, Indian markets seem to have decided it’s wise to follow them.