STUDY OF IMPACT OF DEMONETIZATION ON INDIAN STOCK MARKET

Abstract

On 8th November 2016, the then Prime Minister of India, Mr. Narendra Modi announced that the Indian Currency Notes of value 500 and 1000 will no more be a legal tender. This news came as storm for the Indian which was received with mixed feelings. Prior to Demonetization, cash in circulation was nearly 220 Billion dollars of which approximately 87% i.e. nearly 190 Billion Dollar was in INR 500 & INR 1000 currency notes. This meant its impact was bound to be felt by all sections of the society. In this present paper, we wanted to analyse the impact of this event of demonetization particularly on Indian Stock Market. We have gathered stock market data of last one year and have tried to study its behaviour before and after the demonetization in order to understand its impact. Keyword Index: Demonetization, Stock Market, NSE, BSE, SENSEX,NIFTY