The fall of the market will happen more. You don’t know how long the fall will happen. You don’t know how much we need or liquidity is required when revenue is zero. You need money for provision; you need money for paying your fixed cost. You need money to keep in your locker for this emergency time.  Those who waited for a price correction, valuation gap reduction with price have been blessed mercilessly. Cheap has now become cheapest and is now search for another word to match the fall.  The depth of the fall is much merciless that most political leaders will now find to reconstruct the whole economy and business to be a nightmare.

Buying is not important but selling is more. High yield asset is being sold to have liquidity. Selling asset in one country to get the liquidity back at home is now the only objective. As an investor when FANG stock price has come down and more price and valuation are going to come down then why one will keep investments in emerging economies. It’s now the competition of cheap market to invest rather than chasing valuation. Valuations have come down and will come down further but will when U.S or EU is available cheaply why I should turn my face towards emerging markets. Every market is now cheap and hence the battle to pull money is going to be fierce. Sell even the safe asset since liquidity itself is the safe assets.

Its only time to sell and this sell will continue depending upon the need for liquidity at home. Fixed cost need to be paid and honoured. Salaries, rent, administrative expense all need to be honoured irrespective of sales or revenue. Lockdown is for the citizens but not for the fixed cost. Lengthy lockdown will attract more liquidity as the uncertainty of getting back on feet is restricted.

Analyst community, on the other hand, is just busy on giving response on real-time about very shut down, every manufacturing halt and every loss of revenue and consumption. They are not waiting for data which will come after a month. Financial models are smart enough to predict the loss and reflect the same on markets.

For the global Fund Managers, the game and art of chasing alpha have now become easier as sell-off has led to an oversold market level. Alpha is no longer in the competition but who will come back to buy again and when is the key question.

The fall of the Indian market and global market has led to a significant blow to every class of investor. The 1st free-fall lead to a massive loss but the same is now being recovered through a short sale. This is another weapon through which investor earn money when others cry for the loss.
Financial security, job security are creating panic and hence sell-off is inevitable. Most of us even don’t know how many companies are wipes from the global map. Consumption is now a pause and restarting will need time –which the world doesn’t have right now.

SME sector is highly impacted. How many will get back on the street is a matter of question?  Many SMEs might not come back to the streets again. Unemployment fear is another powerful fear to sell and sell everything.

Start-up business model will be the biggest sellers and suffers. Loss-making business models and pulling liquidity for super return is now to get speed brake. When Fortune 500 companies are available at cheap then why one should search for Alpha in some other asset class. Unlisted share space will be battered. All the planned money-raising activity through various modes and particularly through IPO are all lost now.  These money-raising plans are now a distant dream.

The journey of cheap valuation is not yet over. In the coming weeks, 1st Quarter results of Global markets and India 4th Quarter results will come. Well results are discounted and factored in or few are left to be factored but the more important will be to know the guidance of these companies which will show the future. Bleak outlook followed with a longer horizon of revival will lead to mixed reaction on the markets.

After the impact of the Covid 19 is more fearful since we are yet to think about the same. One of the biggest markets is real estate across the globe.

U.S housing market and the global housing market will spook another massive problem once the Covid 19 comedown. Major economic activities are linked to the housing sector. Defaults and NPA will rise and the slowdown will impact the ancillary industries. The US housing market will now hardly get any buyer as loss of job and uncertainty about paycheck delays every decision making.
Well, the whole article will sound like a parody of negative but truth is now more bitter than the word bitter itself.