Global Recession And Indian Capital Market
The objective of this paper is to throw the light on causes and forethought against the impact of global recession on Indian capital market
. A global recession is a period of global economic slowdown. Informally, it is a period of declining productivity. Whereas a national recession is identified by two quarters of decline, defining a global recession is more difficult, because developing nations are expected to have a higher GDP growth than developed nations. In economics, a recession is a business cycle contraction, a general slowdown in economic activity over a period of time. During recessions, many macroeconomic indicators vary in a similar way. Production as measured by Gross Domestic Product (GDP), employment, investment spending, capacity utilization, household incomes, business profits and inflation all fall during recessions; while bankruptcies and the unemployment rate rise. Recessions are generally believed to be caused by a widespread drop in spending. Governments usually respond to recessions by adopting expansionary macroeconomic policies, such as increasing money supply, increasing government spending and decreasing taxation.A capital market is a market for securities (debt or equity), where business enterprises (companies) and governments can raise long-term funds. Capital Market is stock exchange of any country. It is also called secondary market. It provides place to sell, purchase or raise long term funds. There are 22 stock exchanges in India, the first being the Bombay Stock Exchange (BSE), which began formal trading in 1875, making it one of the oldest in Asia. Over the last few years, there has been a rapid change in the Indian securities market, especially in the secondary market.
Technical analysis refers market is affected by 90% psychological and 10% logical view. So market moves on basis of information. Information efficiency is a measure the swiftness or the market reaction to new information. New information in the form of economic reports, company analysis, political statement and announcement of new industrial policy is received by the market frequently. Markets are influenced by information flows on the one hand and money flows on the other. Global economy recession was started from America to Europe & Asia. The queries of the problem might be traced to unethical practices followed by those financial institutions to improve their market capitalization value artificially, lack of transparency and good corporate governance, manipulations and window dressing in financial statements and failure of government, regulating and monitoring instruments in performing their role effectively and efficiently.
India too had affected by the recession as it was in the process of integrity itself with global economy but the impact was less sever & start lived as basic fundamentals of Indian economy were strong others. The impact of recession on India was less due to degree of integration with global economy was less as compared to other country, the independence on exports as engine of economic growth was less, growth rate was higher, middle class income was expended at fast rate and their standard of living was high, foreign exchange reserves were comfortable and regulating mechanism was more efficient.
Economist suggests forethought against global recession as encourage exports, provide accessible credit for business, improve tax collection, set aside large amount for social welfare, control expenditure on other fields, improve tourism, encourage the injection of money back to the country and improving their rules and regulatory mechanism both national and international.
by: Amit Pratap Singh Economy of Denver Global Exchange Vacation Club Shares The Facinating History Surrounding Veterans Day Dropshipping Guide – How To Start Dropshipping Successfully Have Fun With The Economy Quarters Along With Carriage To Enjoy One Of The Pleasant St Louis Vacatio Things to Consider When Purchasing Patio Umbrellas Why You Should Join Gin Global Information Network What to Know About Shipping International Things to Consider Before Purchasing Your Clothes Hangers The Global Icon Labels - Tiffanys Air Conditioning Has Global Demand Bath Towel Racks: Purchasing A Towel Warmer Turn Your Small Home Business Into A Global Marketing System Acrylic Awards In Today's Economy