Markets Show Resilience Amid Geopolitical Volatility

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Historical Trends Indicate Strong Post-Correction Recovery

Mumbai, April 8: Despite intermittent volatility triggered by geopolitical developments, historical data suggests that Indian markets have demonstrated consistent resilience following sharp corrections.

 

Corrections Often Followed by Measured Recovery

Historical events highlight consistent recovery patterns. During the Iraq War in 1990, markets corrected 14 per cent but delivered 26 per cent returns in one month and 65 per cent over six months, according to HDFC Securities Big Review which was released here on Wednesday.

The report stated that the Kargil War in 1999 saw an 11 per cent correction followed by 17 per cent one-month and 40 per cent six-month returns. After the 2001 World Trade Centre event, markets fell 18 per cent but recovered 45 per cent over six months.

More recent events show similar trends. The Russia-Ukraine conflict in 2022 led to an 11 per cent correction, followed by 7 per cent one-month and 25 per cent six-month recovery.

On average, market corrections have been around 10 per cent, with subsequent one-month returns of 16 per cent and six-month returns of 37 per cent. Median figures stand at an 11 per cent correction, followed by 17 per cent and 38 per cent recovery over one and six months respectively, the report added.