Markets, economy take divergent paths amid Covid-19 uncertainties

The latest rebound in the market has come on the back of a sharp 40 per cent correction in the preceding one-month period with valuations for most stocks plunging to multi-year lows

Former General Electric boss Jack Welch’s famous quote “If you are not confused, you don´t know what is going on” aptly fits the current situation, where the stock market and the economy have taken divergent paths over the past one month.
 

The domestic equity market has soared 20 per cent from its coronavirus lows exactly a month ago, even as most forecasters, including the International Monetary Fund (IMF), have said India will record its worst economic growth since the 1991 liberalisation.
 

It appears investors have been undeterred by the lockdown extension amid a sharp growth in Covid-19 cases -- from