A detail study of Global Markets Recovery from their lows- How Indian Market is reacting?

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Information is based upon 15-04-2020 Time: 7.26 a.m.

Covid 19 issue has resulted in the sharp drop of major indices all around the world. Now with the reduction of cases, these markets have shown V-shape recovery. Let’s find out the lows made by these markets and their recovery from its recent lows. There are certain reasons that have fulled this rally. In this article, we will try to find out these reasons too.

US Markets

All the major indices in United States have seen remarkable come back after their recent lows. Some of the reasons are:

  • The pace at which Covid-19 cases were growing has seen some slowness. Suggesting that the worst is behind us.
  • In the month of March 2020, the US Government & Federal Reserve have announced the economical packages to fuel the economy. US senate passes $ 2 trillion relief package & $ 2.3 trillion package by Federal Reserve as an additional economical aid previous week.

This has pushed liquidity in the system and resulted in the rise of all these indices.

  1. Dow Jones Industrial Average

Yesterday, it has recouped half of its losses from recent lows. The market has seen 2.39% return in Tuesday trading too. All credit goes to President Trump’s comment that he is thinking to opening of economy quicker than earlier expectation.

The indices fallen from 29551 level (12.02.2020) to 18591.93 (23.03.2020) and a fall of 37.09%. Now it is at 23949.76 and recovery of 28.82% from its low.

image 77
Data Source: Google

2. S&P 500 Index

This indices have seen a recent low 2237.40 on 23.03.2020 and now at 2846.06 (14.04.2020). So its has grown at 27.20% from its low.

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Data Source: Google

3. Nasdaq Composite

This indices also shown the similar trend. It has fallen from 9817 level in February 2020 to 6860 level on March 2020. Now trading at 8515.74

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Data Source: Google

European Markets

All the major European Markets have seen the similar trend on the back of reducing corona virus cases as well as economical packages announced in these countries. They came out with the economic rescue packages worth combined €1.7tn to support their economy.

  1. Dax Index

This Indices has fallen from 13789 level in Feb 2020 to 8441.71 in March 2020. Now trading at 10696.56 level

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Data Source: Google

2. CAC 40 Index

This Indices has fallen from 6111.24 level in Feb 2020 to 3755 in March 2020. Now trading at 4523.91 level.

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Data Source: Google

3. FTSE 100 Index

This Indices has fallen from 7457 level in Feb 2020 to 4993 in March 2020. Now trading at 5791.31 level.

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Data Source: Google

How Asian Markets have Performed in the Month of April 2020?

Asian markets have seen similar trend in the month of April. After hitting a low in the month of March 2020. These markets have recouped some of their lost ground. Have a look on the data:

Country% Chg in April
Thailand13.64
South Korea10.18
India (Nifty)8.97
Japan8.71
India (Sensex)8.58
Singapore7.96
Taiwan6.93
Philippines6.88
Hong Kong5.85
China3.39
Data Source: Economic Times Edition 15.04.2020

How to trade for the day?

Currently SGX Nifty is showing that our markets may open at 9200 level and this will be a confirmation of Bullish Double Bottom Break out on Nifty chart. So target of the day is 9300 level and stop loss at 9100. Today strategy is “Buy on Dip”. Buy near 9100 level and look for target 9300 level. Do not trade on opening. . We hold the similar view as yesterday.

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