Comparative Analysis of Impact on the Indian stock market due to the various waves of the COVID-19 Pandemic

This scholarly work was a comparative study between the stock market in India in terms of its reaction towards the three different missions of the COVID-19 pandemic. The results show that there has been a radical insight into changes in the behaviour of the market that have transformed, and are more or less systemic shock to strategic resilience, and finally, complete normalization.   The Waves are synthesized in the following way: 1. The paper finds that the effect of the pandemic on the BSE SENSEX and NSE NIFTY displayed a declining trend of sensitivity:   First Wave was a period of Uncertainty and Panic. As there was no past history of lockdowns like the current activities, this led to herd behaviour and consequently triggered a collapse in the market despite the comparatively low number of clinical cases. This step demonstrated the fact that a market is more scared of the unknown than it is scared of the risk itself.   The Second Wave reflected a "Resilient Decoupling." The market was also bullish although the Delta variant caused a humanitarian tragedy. This implies that by the time that the shock was realized in 2020 and with corporate adaptation and localized containment plans in action, the investors became biased towards long-term recovery and worldwide demand.   The Third Wave was the period of the Normalization. By early 2022, the stock returns correlation statistically changed to be insignificant with the rates of infections. The market innately immunized itself, and focused more on macroeconomic indicators such as inflation and interest rates than on pandemic-related information.

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