Securities and Exchange Board of India (Sebi) Chairman Ajay Tyagi on Thursday highlighted the dangers that emanated from a rising disconnect between the markets and the economic system. He stated the disconnect witnessed within the monetary markets and the economic system had presumably by no means been seen earlier than.
While talking on the second Sebi-NISM Research Conference on Behaviour of Securities Markets – Sighting of a Black Swan, Tyagi stated: “Typically, stock markets have been barometers of the economy and move in the direction the economy moves or is expected to move. However, after the onset of the pandemic, several institutions, including the Financial Stability Board and the RBI, have raised concerns of an increasing disconnect of the financial markets with the real economy and a possible risk it may pose to systemic stability.”
India has been seeing such unprecedented market actions like many international markets as measures had been being taken to deal with the pandemic and its after results.
The sharp swings available in the market from the lows of March 2020 to the historic highs in January 2021 have additionally elevated volatility available in the market. The fall, restoration and the general market motion between March and until date have been important and unprecedented, he stated. Tyagi defined that the functioning of corporates in addition to their fund-raising modified in the course of the pandemic.
The regulator stated the concentrate on ESG had solely elevated additional this 12 months. In line with international pattern, buyers additionally confirmed elevated curiosity in ESG funding. As a consequence of this, Sebi would quickly announce related tips. The regulator said {that a} defining pattern of FY21 was the rise in direct participation of particular person buyers within the markets. —FE
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