Stick to the basics

The stock market is not the economy. This is something that you should not forget even in normal times. The day to day movements of the stock markets reflect the collective opinion of traders on what will happen the next day, week or month. In times of great uncertainty, this period shrinks to hours or at most next morning. All that traders are trying to do right now is to somehow stay afloat till the next session. It would be a grave mistake to imagine that when the Sensex or the Nifty fall by 30 or 40 per cent, that this number is a fair (or even sane) judgement of where the economy will be in two or three years. One circuit down, two, three it does not matter. These are just numbers driven by people who are focused on what will happen tomorrow morning