Throughout 2001, financial markets never showed any signs of coming out from the bear grip. Analysts across the globe are seeing only losses on the horizon for business-to-business stocks, telecom, Internet stocks and the list goes on. There is no sign of recovery whether it is the New York Stock Exchange or the Mumbai Stock Exchange.

The extent of damage infected by the over valuations and the hype surrounding the dotcoms was so severe that it wiped off over $ 10 tr of global wealth in one year. In the US, the markets fell by an average of 28 percent and the fall was more in other parts of the world. This has subsequently effected the consumer spending. Following the decline in consumer spending, majority of companies around the world have issued a series of profit warnings. Irrespective of the fundamentals of the stock and performance, the prices are very low below their book value, as investors are day-by-day becoming more risk averse. This increased risk aversion by the corporates as well as the investors is forcing the stock markets to continue in the bear phase.

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