Do cricket results affect the stock market?
Does Sachin wicket cause the drop in the Sensex?
There is a huge disadvantage of being a MBA student majoring in Marketing. You are surrounded by guys who are Finance majors & they use terms like ‘debt restructuring’ & ‘debt-equity swaps’. They hold themselves in high regard & you feel incompetent in their presence. Just the other day, a similar discussion was taking place so I listened in.
The discussion was regarding the stock market. The discussion was that most of India’s stock market capitalization is through FII investment. That India’s investors had little or no power to affect the stock market. I, for one, was not ready to believe this. Now it is one thing that people didn’t buy stocks but the fact that people don’t have any buying power, is not correct.
So, I decided to carry out my own research. For this, I had to see what influenced the minds of the Indian aam aadmi. As soon as I began pondering, I was hit with two obvious answers, movies & cricket. So, I set out trying to find trends in the Nifty Fifty index related to cricket’s major happenings. This movement shouldn’t be reflected in the INR vs USD index & that would mean that Indian investors have some sort of a say in the Indian share market.
I was amazed at the results; almost every time any major sporting event happened, the stock market responded. There are various unorthodox factors that dictate how the stock market behaves – Skirt-length indicator, Boston-snow indicator, Lipstick indicator, the infamous Big-Mac indicator, Harvard-MBA indicator, Aspirin-count indicator & many more. But this was big news!
Here are the mind blowing results:
|
Time Period |
Sporting Event |
Nifty Reaction |
|
September 2007 |
India Win T20 World Cup |
Nifty rises 1800 points |
|
January 2008 |
India lose 4 match Test Series to Australia |
Nifty falls from 6100 to 4700 |
|
March 2008 |
India win U-19 World Cup &First IPL held successfully |
Nifty gains 680 points |
|
August 2008 |
China hosts successful Olympics |
Nifty falls from 5200 to 2600 |
|
November 2008 |
India best Australia in 4 match Test Series & India clean sweep England (5-0) |
Nifty rises 500 points |
|
February 2009 |
India beat Sri Lanka |
Nifty up 200 points |
|
March 2009 |
Sri Lankan team attacked by masked gunmen in Lahore |
Nifty falls to 2596, a five year low |
|
April 2009 |
India beat New Zealand |
Nifty up 2200 points |
|
September 2009 |
India win tri-series against New Zealand & Sri Lanka |
Nifty up 250 points |
|
November 2009 |
India lose to Australia |
Nifty falls by 500 points |
|
February 2010 |
India beat South Africa & become World Number One in ODIs |
Nifty rises by 400 points |
|
June 2010 |
India win Asia Cup |
Nifty rising, already bullish trend existing |
|
October 2010 |
India beat Australia in Australia & India clean sweep Kiwis |
Nifty reaches all-time high of 6300 |
|
January 2011 |
India lose to South Africa |
Nifty falls 800 points |
|
November 2011 |
Yuvraj diagnosed with Lung Cancer |
Nifty falls 800 points |
|
April 2011 |
India win World Cup |
Nifty up 500 points |
|
July-September 2011 |
India clean swept in England Test Series (0-4), lose a T20 & 3 ODIs |
Nifty falls 1200 points |
|
October 2011 |
India avenge England in India |
Nifty rises 700 points |
|
December 2011 |
Australia thrash India in Australia & India out in group stages of Asia Cup |
Nifty falls 800 points |
|
July 2012 |
India beat Sri Lanka |
Nifty rises 400 points |
|
September 2012 |
India beat New Zealand |
Nifty up 200 points |
|
March 2013 |
India thrash Australia in first 2 Tests of 3 Test Series |
Nifty rises 300 points |
Such a high co-relation is food for thought indeed!