Investment decision amid the second wave of COVID-19

The increase in the spread of the virus is affecting the market. The dropped by 5 percent from its position. However, the suggestions of the experts indicate to remain unaffected by the volatility in the market.

The latest reports of the cases lead towards the probability of hitting the second wave. This may also lead the government to declare lockdown in order to control the spread. This may lead to a decline in the performance of the economy.

Lockdown if put into action may harm the market sentiments. This concerns the investors about their investment holdings.

The rise in the COVID-19 cases affected major states like Maharashtra. Constraining the economic activity in the states will affect the growth expectations of FY22.

The market may experience changes in trading prices due to the upsurge in the cases.

In case when the economic activities decline investors shift towards treasury bonds as they are comparatively a safe investment.

The market may face some challenges till the month-end. However, it will get back to its efficiency at the starting of the next month.

The change of 2-3 percent in inflation has a positive impact on the equities. On the contrary, inflation higher than 3 percent can negatively affect the returns.

The increase in the interest rate results in an increase in the cost of funds. Therefore, for companies the capacity to pay the interest amount reduces.

There may be variations in the bond market as well but it will soon get settled in some days.


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