Abstract
1 The Reserve Bank of India publishes a half yearly report on Systemic Risk providing the insights of the systemic risk in the country which affects the financial system. Since, after 2008 there have not been any financial crisis events in the country which had made the markets volatile. The recent Corona Virus epidemic which started in December 2019 and has ruined the economy in form of lockdowns and affecting the health and financial infrastructure in its initial phases and is continuing. The objective of this paper is to find out whether any relationship exists between the market capitalization of the top financial firms and the crisis events in the economy. In this paper we have made an attempt to relate the events during 2008 global financial crisis with the recent Corona virus pandemic. We conclude that Nifty First 50 financial firms are responding to the economic stress periods and are indicators of the stress in the system. There is strong negative correlation between the market capitalization and the SRISK Capital which is capital required by a financial firm during financial crisis and the correlation becomes very strong during economic recession period indicating a period of financial crisis event. On the other hand Nifty next 50 financial firms do not respond in the same way and they are not having a strong negative correlation between Market capital and SRISK Capital during recession period and may withstand the stress in a better way
Published Version
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