It is not just India which has been witnessing such unprecedented market movements, but similar trends have been there across many global markets i.e. movements one can clearly attribute to effects arising out of the pandemic and the efforts to tackle the pandemic, Tyagi said, speaking at an NISM event.
It can be noted that in the last few months, a slew of concerns have been raised about the disconnect wherein the markets have rallied by over 80 per cent from the lows of April post a sharp correction following the declaration of the pandemic, even as the economy went into a contraction zone.
In the Financial Stability Report, RBI Governor Shaktikanta Das flagged risks to overall financial stability and asked lenders to be cautious about the same.
According to some experts, a liquidity glut induced by economy-boosting measures taken by countries following the pandemic has resulted in the surge in markets.
Tyagi on Wednesday said the pandemic has been rare and catastrophic, and has led to never-before jump in volatilities. The volatility index has come down in the last few months, but continues to be higher than five year averages.
He said a defining trend in FY21 has been the direct retail play in the markets, which has seen an increase in both the number of demat accounts and also investments by individuals.
Corporates have adopted a newer way of working, with annual general meetings and board meetings being held online.
Tyagi said there is a possibility of many of these new practices continuing even after the end of the pandemic, but said issues over confidentiality and security on virtual board meets will have to be assessed going ahead.
He also pondered whether shareholders are getting adequate time to pose their questions at the annual general meets.
Tyagi welcomed the focus on environment, social and governance themed investing and added that Sebi is looking at introducing newer regulations for having more granularity in disclosures.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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