Turbulence has returned to the financial markets with commodity prices plumbing new depths and worries over the US central bank action. While Indian equity markets do tend to gyrate with rest of the global markets in periods of intense risk aversion, investors in India have less to worry from global volatility now, compared to previous years. This is due to the weakening link between the movement in Indian stock prices and other global markets.

Are Stock Markets Interdependent? A Study On Selected Stock Markets | Nikunjkumar Patel - nocuwahojopyx.web.fc2.com

A correlation analysis between the movement of MSCI India and some of the other markets with which Indian equity enjoyed strong links in the past shows that this linkage has weakened significantly over the last three years.

Correlation depicts the strength in the relationship between two sets of variables that change together over a period. The Indian equity market enjoyed a strong link with the Chinese equity market prior to Foreign investors flocked to both these countries due to their higher growth.

The correlation between MSCI India and MSCI China moved between 0. But as China decided to peg back growth and re-balance its economy, Chinese stocks began correcting, make money with justbeenpaid this link feeble. The correlation between the automated binary option trading software reviews probability indices fell to 0.

The trend is similar in connection with the BRICS markets.

Global influence on Indian stock market weakens | Business Line

While the fortunes of the Indian equity market were closely linked to the BRICS group earlier, this too has changed. The poor performance of the Russian, Brazilian and South African markets due to the commodity melt-down has made investors move away from this investment correlation of stock market in india pdf.

The linkage between MSCI India and MSCI BRIC has been less than 0.

Since the linkage between China and India correlation of stock market in india pdf grown weaker, is the Indian equity market now aligning itself with the US? The US equity market had been hitting new highs, led by technology stocks, even as other markets were in the doldrums. It is therefore not surprising that the correlation between MSCI India and MSCI US was This means that the two markets were moving in opposite directions.

The linkage of Indian equities with other Asian peers such as Indonesia and Thailand has, however, been stronger compared to other relationships inthough it was lower than levels recorded between and Catalyst Multimedia Today's Paper Topics ePaper WealthCheck. Decline in correlation between MSCI India and other MSCI indices.

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