How did this inflation value affect sensex points??

Question

How did this inflation value affect sensex points??

Answer 1

Rise in the price of commodities reflect very badly on the price of the shares because rise in price means lesser demand for the product.

Answer 2

Actually a lot of ways the simplest of them being, higher inflation means higher cost of living and hence lesser savings. Lesser savings mean lesser money inflow into the stock market (both direct as well as indirect). Lesser money means lesser demand for the securities available in the market and hence a dip in Sensex points! And thats just the demand and supply side there is another resource side to it as well!

Answer 3

Inflation has come around 11%, which is too high.  But the value around 10% was expected due to the hike in fuel prices.  11% has come as a shock to the markets.

So markets have witnessed great selling. Markets have been hit hard now.