Millions of investors may be wondering what happened to the never-ending stock market rally that was scaling new peaks day after day till a few weeks ago, but the buoyancy on the bourses could be just slipping into the World Cup Cricket arena.
NEW DELHI: Millions of investors may be wondering what happened to the never-ending stock market rally that was scaling new peaks day after day till a few weeks ago, but the buoyancy on the bourses could be just slipping into the World Cup Cricket arena.
Although there is no direct correlation between stocks and cricket, India might be moving ahead to grab the World Cup or at least put up a good performance despite a dismal start, if stock market's benchmark, Sensex, could be taken as a measure of the performance of our cricket team.
This theory does not come from astrology or superstition, the history of the stock market and India's performance during previous World Cups stand witness to it.
Ever since the 30-share benchmark index Sensex came into existence in 1986, there have been five world cups and a good performance by Indian team has mostly coincided with significant losses, while a disappointing cricket has come
hand-in-hand with major gains for the bourses.
The good news for cricket lovers this time around is that market is in the grip of bears, with a loss of over 550 points since the World Cup began in West Indies, although India has opened its account with a dismal loss against Bangladesh.
While a bearish market bodes well for a good performance at World Cup, the only bad news is that it has never led to a trophy win, the best so far has been reaching the finals.
The only time India won the Cup in 1983, when there was no Sensex to measure the performance of our team in terms of stock market trends.
However, thereafter the market movements have more or less stood testimony to India's performance and during the all five World Cups played since then a doom on bourses has spelt a boon for Indian cricket.
During the last World Cup in 2003, Sensex shed 139 points between February 9 and March 24, when India looked invincible till it lost out to Australia in the finals.
India's second best World Cup performance was in 1996 when it reached semi-finals and Sensex lost about 185 points during the tournament during February 14 to March 17.
Even in 1987, when India had reached semi-finals, the market registered a fall during the tournament period.
Moreover, some of the biggest market crashes have been at the time of a decent Indian performance at World Cup.
In 1987, global markets witnessed the first ever 'Black Monday' and biggest ever single-day fall in percentage terms on October 19, which fell during the World Cup.
Close to 1,000 billion dollars worth of investors' money was wiped out in a single day and by the month-end markets like US, UK and Canada plunged by 22-46 per cent, although it was comparatively low at about two per cent in India.
While market analysts would rubbish this correlation as baseless and blame economic factors like global meltdown and inflation as culprits, the trend has been repeated time after time and even during bad performances from Indian team.
In 1992 when India could not move beyond league matches, Sensex added massive 1,340 points during the tournament between February 22 and March 25.
Later in 1999, when India lost out to minnows Zimbabwe and its journey was limited to Super-Six stages, Sensex still managed to gain 34 points till the world cup matches were on.
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