BSE Sensex crosses 48,000-mark for the first time
The Indian Share Market opened on Monday with a bullish momentum (refer to the meaning box). BSE (Bombay Stock Exchange) Sensex crossed 48,000-mark for the first time ever. This rise in the share market was seen after the government gave its emergency use approval to two Covid-19 vaccine – Covaxin (by Bharat BioTech) & CoviShield (by AstraZeneca).
Share market is a volatile market, which means it gets affected by the positive and negative news around the world. When the Indian government broke the announcement, it lifted the sentiments of the investors and they started feeling positive about the economy. This led to investors buying more shares at the Dalal Street causing a bullish momentum.
Example – Anita bought 500 share of ABC company at Rs. 100 per share in November 2020. After the vaccine announcement several of her friends started buying ABC’s shares too. This caused an upward shift in its share price. ABC’s shares started trending at Rs. 200 per share in January 2021. If Anita decides to sell her shares now, she will make a profit of Rs. 100 per share in just a matter of 2 months.
Meaning Box
Share Market: A place where one buys and sells shares.
BSE Sensex: It is a share market index of 30 well established and financially sound companies. It is an indication of the performance of the share market.
Bullish Momentum: An upward buying trend on the Stock exchange. More investors buy shares hence raising the share prices.
Dalal Street: It is the street which houses Bombay Stock Exchange (among world’s 10 most valued stock exchanges) and other reputable financial institutions.
FPI: It is a grouping of assets in the form of shares, bonds, and cash equivalent held by a foreign investor.
Bonds: It is a contract between two companies. Company issues bonds to borrow large sums of money from investors who give them capital instead.
Bearish Market: A bullish trend in the share market is usually followed by a bearish trend as more investors start to sell their shares to get maximum profits before the prices come down again. As a result, bringing the share prices down.