An Analysis of the Performance of Sectoral Indices with Relation to BSE SENSEX

Abstract

A country's capital market has a great significance with respect to its economic growth. Investing in the equity market has always been a matter of concern for the individual investors. SENSEX, better known as the barometer of the country's economy fluctuates with every change in the situations around the country and the globe. The changes in different sectoral indices also have an impact on the change in overall market index as well. In this respect the present paper aims at finding the relation between the sectoral indices with respect to BSE Sensex during the bearish period (2008-2009) and the bullish period (2010-2014). Correlation analysis and Regression analysis of the sectoral indices with the BSE Sensex have been attempted to assess the relative significance of each sector with respect to overall market index. Finally, it is observed that the IT, PSU and Realty sectors showed a negative correlation with the BSE Sensex both during the Bearish phase and the Bullish phase.