Where Is the Bottom? ; the Stock Market's Massive Fall has Been Swift, Sharp and Painful. Experts Believe There's Going to Be More Pain Before It Settles Down. Yet, Predicting Its Bottom Is Like Catching a Falling Knife.

Summary

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The stock market crash has wiped out more than Rs 9.46 lakh crore of the Sensex's market capitalisation since the beginning of this year and caused much pain for investors, but the bottom seems nowhere in sight.

Last week, the Sensex dipped below the 13,000-mark for the first time in 16 months; experts believe there's going to be more pain before it settles down. Yet, predicting the bottom of the stock market is like catching a falling knife, given that just six months ago, there were predictions of the Sensex topping the 25,000-mark this year. Now, the mood is pessimistic, and there are talks of the Sensex dipping below 10,000. This leads to the question: is the 5- year bull-run over? As long as the Sensex stays above 6,200, we will remain in a bull market, says Sanjeev Patkar, Director (Research), Dolat Capital Market, adding that this was the level in December 2004.

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Where Is the Bottom? ; the Stock Market's Massive Fall has Been Swift, Sharp and Painful. Experts Believe There's Going to Be More Pain Before It Settles Down. Yet, Predicting Its Bottom Is Like Catching a Falling Knife.

In the near term, however, the market is reeling under severe selling pressure, which may continue for a while. We are surely in a down market, which can last anywhere from six to 15 months, says V.K. Sharma, Head of Research, Anagram Stock Broking.

In a study of the previous bear markets, Sharma observes th...

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