Report Wire - MintGenie Explainer – What is Bear Market and when does it occur?

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MintGenie Explainer – What is Bear Market and when does it occur?

2 min read
Motilal Oswal Private Wealth

Bears and bulls are typical inventory market animal metaphors, however exactly how is an animal associated to shares? Consider how every creature assaults its prey: a bull usually raises its horns ahead, whereas a bear sometimes lowers its head. In the same manner, when the market is attacked in a downward movement, it is called a Bear market.

A bear market happens when the inventory market’s worth falls for an prolonged time frame. In different phrases, a bear market is outlined as a long-term tendency of dropping inventory costs. For a market to be categorised as bearish, it will need to have seen a big decline of a minimum of 20%. It’s characterised by a drop in speculative demand amongst residents, which reduces the capital sector’s total money circulate.

Bear markets might precede a broader financial downturn, which is horrible for everybody. These markets can endure anyplace from a couple of weeks to a number of years, with the typical being round 18 months. Bear markets have lasted as much as 5 years within the worst-case situations.

The post-Covid bull rise has been halted by ballooning inflation, rising rates of interest, and the Russia-Ukraine conflict, which has put immense strain on inventory markets world wide.

The S&P 500 index, which has a market cap of just about $38 trillion, is already in bear market territory, and the benchmark Nifty 50 and Sensex are dangerously shut. 

This story was first revealed on MintGenie and may be accessed right here. 

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