DON’T WORRY ABOUT THE FALL, INVEST INSTEAD

Jaipur: The recent sharp fluctuations in the stock market following the Union Budget announcements have shaken investor confidence. It is essential for stock market investors to understand their investment purpose and belief. If the investment is based on the better functioning of Indian companies and the potential for rapid economic growth, then market recessions shouldn’t scare them. However, if the goal is to make quick money by selling shares at a rise, investors must constantly monitor market movements and be prepared to bear losses as well as profits. It is unrealistic to expect continuous price increases in any share.

The budget announcements included changes in income tax rates on short-term and long-term capital gains and a minor change in the tax rate on share trading. The subsequent market decline indicates that Indian investors have not yet matured, reacting impulsively to negative news without thorough analysis. Most of last week’s market decline was recovered on Friday, with the BSE index closing above 81,000, rising by 1,292.92 points, and the Nifty index reaching a new high. This market rise disrupted the predictions of those expecting a continued recession.

Given the trend of improvement in international markets, it can be assumed that the Indian stock markets will also follow a bullish trend, supported by the positive outlook for the Indian economy and the expected favorable results from major companies this month. However, this is contingent on investors continuing to make new investments rather than panicking during declines.

The decline of the previous week was compensated by the trading session that ended on Friday. Over the entire last week, the BSE index improved by 728.07 points (0.90%), closing at 81,332.72 points after reaching a high of 81,427.18 points. The NSE Nifty index rose by 303.95 points (1.24%), closing at 24,835.85 points after hitting 24,861.15 points. The midcap and smallcap indices also showed improvement, which is a positive sign for the market.

Foreign institutional investors (FIIs) sold shares worth Rs 4,721.26 crore last week, indicating shaken confidence. However, domestic institutional investors (DIIs) countered this by buying shares worth Rs 8,109.78 crore. In the bullion market, the Union Budget’s reduction in import duties on gold and silver led to a broad decline in their prices. Gold prices fell by Rs 4,650 per 10 grams, and silver prices dropped by Rs 7,350 per kilogram. In Jaipur, 24-carat gold prices fell from Rs 75,100 to Rs 70,450 per ten grams, while silver prices decreased from Rs 91,450 to Rs 84,100 per kilogram. Traders anticipate further improvement in gold and silver prices due to increased demand following the price drop.

Traders predict a positive market trend this week based on technical analysis and better performance results from major companies. They believe that long-term investments can still be made in companies with strong fundamentals. Some recommended companies include BHEL, Bharat Electronics, IDBI, IFCI, ITC, Suzlon Energy, ICICI Bank, Hindustan Organics, Pakka, Mind Tech, and India Oil Corporation. However, investors should remember that even strong shares can fall in a declining market.

First-quarter financial results will be announced this month, potentially impacting the market. Investors can apply for IPOs of Akum Drugs, Seagull India, and Ola Electric on the main board. Additionally, there are 12 new IPOs on the MSME platform, but no new Draft Herring Prospectus submissions to SEBI this week.

THESE ARE PERSONAL VIEWS OF THE AUTHOR