Impact Of Agriculture2

IMPACT OF AGRICULTURE IN SHARE MARKET

FINANCIAL MARKET (deals with financial assets)  Money

Market- Short term market regulated by the RBI  Credit Market- Short & long term market regulated by the RBI  For-ex Market- Short & long term market for foreign exchange regulated by the RBI  Credit Market- Long term market regulated by the SEBI Act,1992

CAPITAL MARKET PRIMARY MARKET

SECONDARY MARKET

 Where

 Where

securities are first issued

securities already issued are traded

ANALYSIS OF FLUCTUATIONS Can be done through two approaches Fundamental

Analysis  Technical Analysis

TECHNICAL ANALYSIS Deals with the effect of demand and supply in the market

FUNDAMENTAL ANALYSIS Classified into three types Economic Analysis  Industry Analysis  Company Analysis

ECONOMIC ANALYSIS        

GDP Exchange Rate The Balance Of Payments Current Account Depriciated Government Policies Unemployment Inflation Interest Rate etc.

INDUSTRY ANALYSIS   

Sensitivity Of Business Cycle Industrial Life Cycle Industrial Structure And Performance etc

COMPANY ANALYSIS    

Business & Financial Risks Financial Statement Of The Company Business Plan Of The Company Management Of The Company etc

GENERAL TERMINOLOGIES  SHARE

MARKET – A share is the holding of an individual of an entity for which he is to receive a proportionate part of the profit measurable in terms of money. A place

where the collective shares of different companies are traded is a share market.

LINK OF AGRICULTURE TO SHARES (economic analysis) From the economic analysis point of view Share prices are higher when the economy is growing  An indicator of economic growth is a healthy export, low imports, high employment, a prospering GDP etc.  Agriculture by contributing to all these lead to economic growth and hence indirectly affect share prices

FOODGRAIN PRODUCTION Food

grain production was estimated at 201 million tonnes in 2005-2006 Commercial crops was estimated at 244.8 million tonnes in 20032004

GROSS DOMESTIC PRODUCT  It

is a measure of National Income. GDP is the total market value of all the final goods and services produced in a country during a period of time. A prospering GDP means a higher valuation of shares.

PERCENTAGE GROWTH OF AGRICULTURE IN GDP     

Growth of 6.5% in 2001-02 Came down by 5.2% in 2002-03 Rose to 9.1% in 200304 Fell by a mere 0.5% in 2004-05 Rose to an estimated 10.7% in 2005-06

EMPLOYMENT  Provide

nearly 53% of the total employment.  Good production means higher income and higher spending.  Seeks out for low wage, resulting in higher profits which could be used for further investment

EXPORTS AND IMPORTS 

Agricultural exports constitute about 20% of the total exports. The entire amount of which can be spent on import of nonagricultural goods.



Agricultural imports constitute about 25% of the total imports. Leads to a great loss in foreign exchange.

INTEREST RATE  In

2003, Rs 43000 crores of farm debt was sourced by non-fanancial institutions  18000 crores was given away as interest

GLOBAL WARMING Threatening 20—25% of world vegetation  Rise in temperature  Changing pattern of monsoons  Natural disasters  Changing cropping pattern

INFLATION  As

reported by World Bank, the present price rise will continue till 2009.  After that it will decline when demand and supply reacts to high prices.  Speculation regarding the rise of future prices generally affect the share prices.

CONTRIBUTION TO OTHER SECTORS Agri surpluses are used for industrial development. Good production indicates a healthy atmosphere and higher investment most critical for influencing share prices

CONCLUSION

VOTE OF THANKS