STATEMENT OF THE PROBLEM
The Indian stock market, particularly financial banks listed on the National Stock Exchange (NSE), will continue to be volatile, providing significant difficulties for investors and affecting market stability. This requires certain measurement, in-depth analysis, and identification of the primary causes of volatility, as well as their influence on individual companies. Addressing these critical areas through extensive research is critical for supporting informed decision-making, implementing effective risk-management methods, and developing good policies that promote a more stable and secure financial sector in India.
OBJECTIVE OF THE STUDY
• To analyze historical stock data to identify and evaluate volatility trends for HDFC Bank, ICICI Bank, State Bank of India, Kotak Mahindra Bank, and AXIS BANK on NSE.
• To find out the relationship among GDP, dividend policy, and the stock price of HDFC Bank, ICICI Bank, State Bank of India, Kotak Mahindra Bank, and AXIS BANK on NSE.
• To study the impact on the financial performance of HDFC Bank, ICICI Bank, State Bank of India, Kotak Mahindra Bank, and AXIS BANK on NSE.
• To study the investor's perception of stock market volatility.
GDP RATE
• Higher GDP growth often translates to increased corporate earnings, boosting investor confidence and potentially calming market volatility.
• The impact of GDP on volatility also depends on other factors like foreign investment inflows, global economic trends, and domestic policy decisions.
DIVIDEND POLICY
• High dividends: Can pull money out of the market, lowering stock prices and potentially increasing volatility.
• Low dividends: This can signal to investors the company has future growth plans, potentially making prices more stable.
• Unpredictable dividends: Create uncertainty, causing investors to buy and sell more often, likely increasing volatility.
EARNING PER SHARE
• Higher earnings per share (EPS) generally calm the Indian market: They show companies are making money, boosting investor confidence, and reducing panic selling.
• Surprise drops in EPS: Investors fear future profitability, leading to sudden stock selloffs and increased volatility.
INFLATION RATE
• High inflation: Prices rise, making businesses less profitable and future earnings uncertain. Investors get nervous, selling stocks, leading to price swings and market volatility.
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