Jobaaj Stories
After Russia's capture of more of Ukraine's rebel-dominated territories, the bells of the oncoming war are being heard by investors and traders all around the world.
Consequently, the Indian stock market bled red, yesterday, with the major benchmark indices falling more than 2 percent at the opening bell itself.
The market downfall has been continuous and its been going on since February 17th.
In fact, February 16th was the last day the Indian equities were seen in green, until today.
Not only limited to India, but the Russia Ukraine crisis has also put markets all over the world in shambles.
By yesterday, almost 9.1 lakh crores of investors' wealth has been wiped out in a period of just 5 days.
Tuesday saw the Nifty tank by 359 points to open at a crucial level of 16,848, although the market seems to be recuperating today, with the Nifty opening at 17,194 points today.
Currently, the market seems to be correcting itself after 5 days of continuous downfall, however, the Russia Ukraine Crisis still continues, and news of imminent war is still at large.
The market sentiments are still expected to be on the low.
What is the Russia Ukraine Crisis all about?
The Russia Ukraine conflict has been going on since world war 2, however, in 2014, Russia launched a full-fledged invasion of Ukraine's region Crimea. Special forces and Russian troops began flooding Crimea through Novorossiysk.
Russia illegally annexed Crimea in 2014.
And now, in 2021, Russia has put forward an advanced two draft treaty that contains requests for what is referred to as “security guarantees”.
It states that a legally binding promise should be rolled out that Ukraine would not join the North Atlantic Treaty Organisation (NATO), and that the said organization would reduce its troops and military hardware stationed in Eastern Europe.
Russia has threatened NATO with an unspecified military response if the demands were not met in full.
And that has been the initiation of Russia's military response and arms mobilization on the borders of Ukraine.
What could be the impact on the Indian stock market?
The Indian stock market along with other equity-based markets of the world has already shown a downward reaction to the Russia Ukraine crisis.
With Russia's stationing of troops along Ukraine's border, the news of the imminent war is still at large.
US president Joe Biden has recently come live to share his concerns regarding the upcoming war and has announced that “Russia could launch an attack at Ukraine any time now”
Furthermore, Russia has now launched nuclear drills after its parliament has allowed the “use of force abroad”
If a potential war breaks out, the market might respond aggressively in red and reach pandemic levels of bearish trends.
The market correction of today should not be taken as a sign of a potential bullish trend. The market sentiment is expected to remain bearish if the Russia Ukraine crisis escalates or remains as it is for an extended duration of time.
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