The Stock markets all over the world has recently undergone a depression from the beginning of the year 08. The reason for this is obvious. The first reason for this is the recent US slowdown due to sub-prime lending which has given a big blow, as most of the Foreign Institutional Investment (FII) comes from US and secondly the US elections. Indian stock market has also been the victim of this US slowdown and so price of some of the momentum stocks like Indiabulls Financials, Indiabulls Securities and Videocon Industries has come down by over 90%. Now the major question that has arisen among the investors is that – Will this slowdown in the world market continue for the years to come?
The answer to this question is an obvious no. Firstly, the Federal Government has already taken steps to recover the US economy form depression and if this becomes effective, the US economy will start recovering from March or April 09 and the Indian Economy will again see rising stock prices. Moreover, the technical of Indian market are very strong and so the Indian market is a preferred market to invest for most of the FIIs. Secondly, after the US and the Indian elections, the investors will find stability in the market and so they will start investing. So I think one can expect an overall momentum in the stock market from the second half of 2009.
As per Economics, if there is a boom, there shall always be a depression and this depression in the world market is no exception to it. So I think that it is the right time to invest as the Indian stock market near the bottom line. Some of the shares which according to me can give very good return in future include Indiabulls Securities, Indiabulls Financials, Videocon Industries, Century Textiles, IDFC and Jaiprakash Hydro.