Why Interest Rates Affect the Stock Market?

1.Interest Rates influence stocks prices because they affect corporate profitability , alter valuation relationships, and influence margin Transactions.

2.Interest rates have led stocks prices at major turning points in virtually every recorded business cycle.

3.It is the ROC of interest Rates, rather that their actual level, that affects equity prices.

4.Short-Term  interest rates generally have a greater influence on stocks prices that longer-Term rates.

5.Changes in the Discount rate  offer strong  confirmation that a primary-trend change in money-market prices has taken place.

6.Reversals in the Trend of the discount rate offer early-bird warnings of a change in the primary trend of stock prices.

7.Intermarket relationships can be used to forecast or identify primary-trend reversal in bond prices and yields. 

Nifty @ 14000 and Sensex @ 40000 by 2020

Kondratieff, a Well  Know Russian Economist, who used Whole Sale Price Index in 1926 to Guage the Long Term Wave of World’s Economy, used 40 Years Long Business Cycle.

The Wave has made lows in 1780,1840,1900,1940,2000 and Peaks in  1814,1864,1920 & 1970 respectively.

Our Indices (Nifty & Sensex) has made low in 2000(Also the Kondratieff Wave has made Low in 2000) and after that We have seen one Great BULL-run from 2001-2008 and a Melt-Down from 2008-2009.We are in the Half-Way of Kondratieff Wave. The existing Bull Run will last till 2020 and we may see minor correction in Indian Stocks Market as well in Between and Hope that Nifty Will Touch 14000 and Sensex 40000 by 2020.

After that We may see a Major World Economy Crisis. Possibilities of 3^rd-World Ward may not be Ruled out after 2020, when there will be a Shifting of World Market Leader from  USA  to China or Say Asian Countries and a longer period of Higher Interest Rate and High Inflations after 2020 is also expected .

It is prudent to Ride this Nifty’s 14000 Journey with Blue Chips Stocks only  with 80% Load & rest 20% with the new-business opportunity Stocks .