Slide 2: Introduction To Sensex BSE (Bombay Stock exchange came out in 1986 with Stock Index & a basket of 30 constituent stocks representing a sample of large, liquid and representative companies . The index initially was calculated on the basis of Full Market Capitalization Methodology but then shifted to the Free Float Market Capitalization Methodology with effect from September 1, 2003.
Slide 3: Sub Prime Crisis When a borrower can not repay to lender due to the inability to pay, the bad credit history of the borrower or high interest rates of lender, at that time the condition is called Sub Prime Crisis. RBI views on Sub Prime Crisis: -
RBI has cautioned banks and corporates to be vigilant. They should monitor exposures and hedge them to avoid shocks.
RBI said that if there is deterioration in the sub prime crisis then definitely the emerging markets are going to be impacted
How Sub Prime Crisis Affects Economy Of Country : How Sub Prime Crisis Affects Economy Of Country Borrowers who
are unable to pay
their Loans Spreads Risk:
Because Banks sold loans to
hedge funds and as hedge
funds become more cautious,
the banks are stuck with the risks. Makes financing More Expensive Led to few Acquisitions or
Failure of it Companies will Invest less And Growth of the company
As well as Economy of the country will get affected
Slide 5: The Movement In Sensex Due To Sub Prime Crisis Aug 16 Equities, bonds and currency markets fell sharply. Sensex tanked by 642 points; the rupee lost 60 paisa against the US Dollar and bond prices retreated by about 45 paisa.
Slide 6: Chart Showing Movement In Sensex
Slide 7: Thank you
May God Bless U All