Professional Documents
Culture Documents
SWAREENA SRIVASTAVA-17
MUSKAN ANAND-18
SAKSHI SHARMA-19
CHETAN GARG-39
HARSHAL MEHROTRA-42
DHANANJAY SHARMA-49
6 CHAPTER 6: CONCLUSIONS 15
ECONOMIC PERFORAMCE:
One can characterize economic performance as the expansion in the inflation changed market
estimation of the goods and services delivered by an economy over the long run. Economic
analysts customarily measure such development as the percent pace of expansion in genuine
total national output, or GDP.
The different measures of economic performance may include:
Economic growth
Inflation
Current account
Unemployment
STOCK MARKET
The stock market is a collection of markets and exchanges where regular activities of
buying, selling, and issuance of shares of publicly-held companies take place. Such financial
activities are conducted through institutionalized formal exchanges or over the counter
marketplaces which operate under a defined set of regulations. There are be multiple stock
trading venues in ax country or a region which allow transactions in stocks and other forms of
securities.
The stock market is a similar designated market for trading various kinds of securities in a
controlled , secure and managed environment. Since the stock market brings together
hundreds of thousands of market participants who wish to buy and sell shares, it ensures fair
pricing practices and transparency in transactions. earlier stock markets used to issue and deal
in paper-based physical share certificates, the modern-day computer-aided stock markets
operate electronically.
FUNCTION OF STOCK MARKET
The stock market is one of the most important ways for companies to raise money, along with
debt markets which are generally more imposing but do not trade publicly.It allows
businesses to be publicly traded, and raise additional financial capital for expansion by selling
shares of ownership of the company in a public market. The liquidity that an exchange
affords the investors enables their holders to quickly and easily sell securities. This is an
attractive feature of investing in stocks, compared to other less liquid investments such
as property and other immoveable assets.
The price of stocks and other assets is an important part of the dynamics of economic activity
and can influence or be an indicator of social mood. An economy where the stock market is
on the rise is considered to be an up and coming economy. The stock market is often
considered the primaryx indicator of a country's economic strength and development.
The stock market works as a platform through which savings and investments of individuals
are channelized into the productive investment proposals. In the long term, it helps in capital
formation & economic growth for the country.
LITERATURE REVIEW
Rudra P. Pradhan(2018) : The paper looks at the since quite a while ago run connection
between advancement of securities exchange and financial development in G-20 nations for
the period 1980–2015. Utilizing vector auto-backward model for testing the Granger
causalities, the investigation finds the presence of both unidirectional and bidirectional
causality between improvement of securities exchange and per capita financial development.
The strategy ramifications of this investigation is that the monetary approaches ought to
perceive the distinctions in the advancement of financial exchange and per capita monetary
development to keep up feasible improvement in the G-20 nations.
Chien, Mayer, R.W, & Wang (2014): Utilizing securities exchange and monetary information
from 1900 to 2008 from 27 separate official organizations in the United States (U.S.),
including 15 Republican and 12 Democratic, this paper looks at the connections between the
market return after every Election Day and financial execution during the official term.
Utilizing the hypothetical structure of political economy, the creators inspect how Wall
Streets response to an official political decision goes about as a prescient proportion of future
monetary execution. The investigation shows that the after-political decision market
development has continuously been more precise in anticipating the future Gross Domestic
Product (GDP) development however not the future joblessness rates. Given that the
outcomes show a higher connection over the long haul, the model seems to give a decent
beginning stage to making a decision about the monetary capability of future official
organizations.
Ahmad Zubaidi, Zulkornain (2014) Experimentally we research how three sorts of private
capital streams could advance financial development in beneficiary created and agricultural
nations. Our emphasis is on the part of financial exchanges as a channel through which
unfamiliar capital streams could advance development. The discoveries uncover that FDI
shows a positive effect on development, while both unfamiliar obligation and portfolio
speculation negatively affect development in all example nations. Nonetheless, our outcomes
show that financial exchanges may be a critical channel or driving institutional factor through
which capital streams influence monetary development. The discoveries give clear
ramifications that the negative effect of private capital streams can be changed into a positive
one if the securities exchange improvement has achieved a specific edge level, whether or not
it is in evolved or non-industrial nations.
Chaido Dritsaki and Melina Dritsaki (2013): This paper analyzes observationally the causal
relationship among monetary turn of events, credit market and financial development by
utilizing a trivariate autoregressive VAR model in Greece for the inspected period 1988:1–
2002:12. The consequences of cointegration examination recommended that there is one
cointegrated vector among the elements of financial exchange, the financial area
advancement and monetary development. Granger causality tests have indicated that there is
a respective causal connection between banking area improvement and monetary
development and a unidirectional causality between financial development and securities
exchange advancement while there is no causal connection between the securities exchange
and banking area improvement.
Ifeuro Osad and Abudu Kasimu (2013): In the paper, we look at the causal relationship and
the heading of causality between securities exchange advancement and monetary
development in Ghana, Kenya and Nigeria. In inspecting the causal relationship and the
heading of causality, we utilized the Granger Causality test methodology as evolved in
Granger. The investigation relapsed five pointers of financial exchange in particular securities
exchange capitalization (MC), stock turnover proportion (STO), stock exchanged worth
(TVL), number of recorded protections (LS), and securities exchange file (MI) against the
genuine (GDP) which is utilized as an intermediary for financial development. Utilizing the
1989 – 2009 informational indexes, the exact discoveries of the examination show that there
is no causal connection between financial exchange advancement and monetary development
in Ghana and Nigeria, yet uncovered a bidirectional causal relationship between financial
exchange improvement and monetary development in Kenya. At the point when MC was
utilized as an intermediary for securities exchange improvement, MC and LS were found to
Granger cause financial development. Bidirectional causality was found between STO and
GDP. TVL was found to have a solid negative impact on GDP. In light of the aftereffects of
the investigation, we suggest that strategy creators and administrative bodies ought to plan
and execute strategies that will draw in speculators and benefit the genuine area of the
economy the truly necessary asset for creation and energize posting of organizations that
contribute to a great extent to GDP in the country stock trade
Boubakari Ake & Rachelle Ognaligui (2012): In this article Sims' causality test dependent on
Granger meaning of causality was utilized to inspect causality connections between financial
exchanges and monetary development in Cameroon dependent on the time arrangement
information from 2006 to 2010. Our discoveries propose that the Douala Stock Exchange
actually doesn't influence Cameroonian financial development. Examination has been made
in this point and discovered positive connection between monetary securities exchange
improvement and financial development, yet in Cameroon the reason for the public authority
to create economy, by making the Douala Stock Exchange is as yet not came to. In the wake
of running fluctuation decay trial of Cholesky, we discovered orderly proof that the market
capitalization influences decidedly the GDP. Our paper concocts the open door given to the
Cameroonian government to comprehend that the time has come to discover monetary
approaches, to empower organizations and create monetary financial exchange culture, and
upgrade to push organizations to start IPO rather than bank advances when cash is expected
to expand their venture.
IMPACT OF COVID-19
There is a major shift in the economies of the world and the stock market has been seen as
crashing step by step. Production lines, Restaurants, Pubs, Markets, Flights, Super Markets,
Malls, Universities and Colleges and so forth were closed down. Dread of COVID-19 has
restricted the development of the people. Individuals were not in any event, going to purchase
the day by day basics and these all were some place affecting the economy of the world in
general. The Organization for Economic Co-activity and Development (OECD)reveals that
they have cut their desire for worldwide development to 2.4% from 2.9%, and cautions that it
could fall as low as 1.5%.
India faces an enormous decrease in government incomes and development of the pay for at
any rate two quarters as the COVID-19 hits monetary movement of the nation all in all. A fall
in speculator opinion impacts privatization plans, government and industry.
The lockdown in India will sizeably affect the economy mostly on utilization which is the
greatest segment of GDP.
India's all out electronic imports is equivalent to 45% that of China. Around 33% of
apparatus and just about two-fifths of natural synthetics that India buys come from China. For
car parts and composts China's offer in India's import is over 25%. Around 65 to 70% of
dynamic drug fixings and around 90% of certain cell phones come from China to India.
Coronavirus has upset worldwide stockpile chains and this is producing spill over impacts all
through various degrees of provider organizations. Worldwide exchange 2020 will fall in
each locale of the world, and will influence all areas of the economy. This will affect nations
that are solid exporters (no yield for their nearby organizations), yet in addition those that are
shippers (absence of crude materials). The World Trade Organization (WTO) anticipates that
worldwide exchange should fall up to 32% this year due to the COVID pandemic.
A worldwide recession currently appears to be inescapable. In any case, how profound and
long the decline will be relies upon the achievement of measures taken to forestall the spread
of COVID-19, the impacts of government strategies to mitigate liquidity issues in SMEs and
to help families under monetary trouble. It additionally relies on how organizations respond
and plan for the re-beginning of financial exercises. Furthermore, most importantly, it relies
upon how long the current lockdowns will last.
The nation is confronting an additional standard testing time in this monetary year. India
needs to direly figure out how to pad the interest side stuns initiated by expected lockdowns
and other continuous regulation measure.
Developing nations like India has more delicate monetary and social texture and the current
circumstance will make all the more languishing over the unorganized sectors and traveler
work. Acquiring the expressions of previous RBI lead representative C Rangarajan
"Administration of India should give helps to organizations - stretch out credits and duty
waivers to private companies and the independently employed to hold staff - give direct help
to seriously influenced ventures and give more assets to states, charge waivers to family units
and so forth”
Chapter 4:
Research methodology
Research methodology comprises of different procedures and techniques which are used to
analyze, and process information. The present study is objective, precise and arrives at
conclusion on the basis of certain evidence. Hence the research for the fact should be made
scientific method to arrive at accurate results.
Types of Research: Analytical research
SOURCE OF DATA
Secondary data: Secondary data is the data that has been already collected and is readily
available from other sources. The various sources of secondary data for this project are:
1. Database of different websites.
2. Newspapers.
3. Internet
Data source:
https://www.statista.com/statistics/263617/gross-domestic-product-gdp-growth-rate-in-india/
https://en.wikipedia.org/wiki/Economy_of_India
https://www.macrotrends.net/countries/IND/india/gdp-growth-rate
https://www.bseindia.com/
RESEARCH OBJECTIVES
RESEARCH LIMITATIONS
It is easy to find and collect secondary data., however, you need to be aware of the limitations
the data may have and the problems that could arise if these limitations are ignored.
1. Secondary data can be general and vague and may not really help organizations with
decision making.
2. The information and data may not be accurate. The source of the data must always be
checked.
3. The data maybe old and out of date.
4. The company publishing the data may not be reputable.
5. Not Specific to Researcher's Needs.
6. Inefficient Spending for Information.
7. Incomplete Information.
8. Not Timely.
RESEARCH TOOLS
Various research tools used in this project are –
Descriptive statistics:
Descriptive statistics, in short, help describe and understand the features of a specific data
set by giving short summaries about the sample and measures of the data. The most
recognized
types of descriptive statistics are measures of center: the mean, median and mode, which are
used at almost all levels of math and statistics.
Mean
Median
Mode
Variance
Standard deviation
Kurtosis
Skewness
Chapter 4:
DATA ANALYSIS
India’s real GDP growth rate slowed to 3.1% for the fourth quarter of FR 2020. Nominal
GDP growth rate, at 7.5% saw a slight improvement from the previous quarter.
Descriptive statistics:
Mean 6.711
Median 6.39
Standard 1.36
Deviation
Variance 1.84
Kurtosis -1.87
Skewness 0.19
Range 3.48
Minimum 5.02
Maximum 8.5
Count 10
GDP Growth (%)
9.00%
8.00%
7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
2008 2010 2012 2014 2016 2018 2020
The economy is said to return in the positive zone in the 3rd quarter of the current year by an
article on the 'state of economy' in the RBI Bulletin.
CONCLUSION
The Indian GDP was studied for the years 2010-2019. Indian GDP development was at its top
in March 2010 when it scaled 8.50% growth. The nominal GDP in September 2019 was at
5.02%, its most reduced in the decade. From that point forward, the descending pattern is
obvious and we are presently scratching the base at about a genuine GDP development pace
of 4.5%.
The decrease in the guarantee is sufficiently clear by the adjustment in the organization of the
economy during this decade. In 2010, farming contributed 17.5% of GDP, while industry
contributed 30.2% and administrations 45.4%. In 2019, farming tumbled to 15.6%, industry
to 26.5% and administrations to 48.5%. The portion of industry has been sliding. This is the
normal profile of a post-mechanical economy. The irony of India getting post-modern
without having industrialized should not be missed.
In this paper the impact of COVID-19 is studied on the performance of the Indian stock
market and the Indian economy using multiple measures, like standard deviation, skewness,
and kurtosis, of the two composite indices on the data from Jan 2019 to May 2020.
The Indian stock market turned out to be more volatile during COVID-19 period, and the
returns exhibit non-normality at all times. However, during the crisis, it is observed that
skewness becomes negative with index returns.
The value of the kurtosis are computed to be extremely big, indicating that the returns follow
a leptokurtic distribution both during the crisis and before the crisis.
The pandemic period has seen an expansion and a diminishing in kurtosis. The negative
skewness and higher kurtosis esteem is a marker of future danger.
Another significant finding of the paper is that the Indian securities exchange portrays
generally a similar standard deviation contrasted with the created economies of the United
States, Japan, and the United Kingdom however has higher negative skewness and higher
positive kurtosis of profits, which cause the market to appear to be more unpredictable.
With the quantity of expanding COVID-19 cases, the current market looking separated with
the monetary reality and the profits showing the non-typical conveyance with expanding
negative skewness and higher positive kurtosis.
In this specific circumstance, it is proposed that risk-averse investors ought to stay away from
putting resources into exchange during COVID-19 period, and those momentary speculators
who are holding the stocks should close their situations as ahead of schedule as conceivable
to dodge misfortunes. Furthermore, speculators could purchase low when there is a huge fall
on the lookout and close the situation in almost 5 to 10 trading days at whatever point there is
a specialized recuperation for liberal benefits.
SUGGESTIONS: