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What is a Stock Market?

Stock Market

About Stock Market

What is a Stock Market?

Basic explanation of stock market:

It is a place where regular activities of buying, selling, and issuance of shares of publicly-held companies take place. In the stock market, one can also trade in financial instruments such as derivatives, bonds, mutual funds, along with shares of a listed company.
A stock exchange is the meeting place for buyers and sellers for trade. In India, the prime stock exchanges are the National Stock Exchange and the Bombay Stock Exchange.

Types of markets:

One can trade in either one of the two market segments: the primary market and secondary market.
Primary market:
The primary market is where a company first gets registered to raise money and issues a certain number of shares or bonds. It's in this market that firms float new stocks and bonds to the public for the first time. When a company decides to list its shares for the first time this is known as an initial public offer (IPO).
Another way for a company can raise capital in the primary market is through rights offering or issues. A rights offering (issue) allows companies to raise additional equity through the primary market after having securities in the secondary market.
Secondary market:
After stocks or securities of a company have been sold in the primary market, they are then traded in the secondary market. Investors trade previously issued securities without the companies' involvement. In the secondary market, the investor buys shares from another investor at the prevailing market price or whatever price both the buyer and seller agree upon.
In India, primary and secondary markets are governed by the Security and Exchange Board of India (Sebi).

What is traded in the stock market?

In the stock market, various kinds of financial instruments are traded which are shares, bonds, mutual funds, derivatives.
A share is a single unit of ownership in a company or financial asset.
Bonds are a way in which a company opts to borrow funds from a variety of investors, which is also paid off through timely interest payments.
Mutual funds are investments that allow one to indirectly invest in the share market.
Derivatives are instruments that allow one to trade at a price that has been fixed by the person trading.  It means that one enters an agreement where they choose to either sell or buy a share or any other instrument at a certain fixed price.

What is a bull market?

A bull market means the share market is rising and investor sentiment is confident, further encouraging other investors to buy. Generally when the sharemarket is ‘bullish’, the economy is strong and unemployment is low.

What is a bear market?

Essentially a bear market is the opposite of a bull market. That means if the market falls by 20% or more from the 52 week high, it has become a bear market. A bear market is generally marked by investor pessimism which can cause prices to continue falling, adding to further negative sentiment.

What is a stock market correction?

Sometimes a steep fall in market prices can be a market correction rather than a bear market. Generally speaking, a fall of 10-20% is considered a market correction, with a fall beneath 20% considered a bear market.
However, whereas a bear market is usually a sign of negative investor sentiment, a market correction is often a temporary price reversal before the market continues moving upwards.

Latest Updates on Stock Market

Market capitalisation of BSE Midcap firms a whisker away from $1 trn

On Friday, the cumulative mcap of midcap firms settled at $0.96 trillion

Updated On : 12 Jul 2024 | 11:15 PM IST

Conservative hybrid funds can be a better bet than fixed deposits

Asset allocation ensures investor gets small exposure to stocks in a predominantly bond portfolio

Updated On : 12 Jul 2024 | 2:00 PM IST

Swan Energy's shares locked in upper circuit twice in two days; here's why

Shares of Swan Energy got locked in the 5 per cent upper circuit at Rs 727.20 per share on the NSE in Tuesday's early morning deals

Updated On : 09 Jul 2024 | 10:07 AM IST

Investors subscribe Ambey Laboratories IPO over 173.18 times offer size

The initial share sale received bids for 69,99,86,000 shares against 40,42,001 shares on offer, as per NSE SME data

Updated On : 08 Jul 2024 | 10:57 PM IST

AU Small Finance Bank's shares slump 4% on muted growth in Q1 biz update

AU Small Finance Bank's stock dipped up to 4.25 per cent at Rs 250.55 per share on the BSE in Monday's intraday trade

Updated On : 08 Jul 2024 | 12:13 PM IST

Marico's stock surges over 6% on decent Q1 update, bullish outlook

Shares of FMCG major Marico soared up to 6.56 per cent at Rs 655.70 per share on the BSE in Monday's early morning trade

Updated On : 08 Jul 2024 | 10:13 AM IST

Stock Market Highlights, July 8: Indices end flat after listless day; PSBs fall, FMCGs buck trend

Stock Market Highlights on July 8: The broader indices, though, hit all-time highs in the intraday trade, ended with a negative bias as well

Updated On : 08 Jul 2024 | 3:52 PM IST

Downturn in sight for Nifty50, MidCap Select indices; here's how to trade

When examining the Nifty 50 Index, currently trading in the overbought zone, technical indicators such as MACD, RSI, and Stochastic suggest it is challenging to recommend initiating fresh long

Updated On : 08 Jul 2024 | 6:23 AM IST

Global trends, earnings from TCS, HCLTech to guide mkts this week: Analysts

Markets may consolidate after the record rally last week, experts added

Updated On : 07 Jul 2024 | 10:13 AM IST

Restaurants Brand Asia stock rallies 5% after HDFC Mutual Fund buys stake

Shares of Restaurants Brand Asia soared up to 5 per cent at 113.92 per share on the BSE in Friday's intraday. This came after the company informed the Indian exchanges about the bulk deal

Updated On : 05 Jul 2024 | 3:03 PM IST

Thermax's stock rises 5% after subsidiary gets work order worth Rs 513 cr

Thermax shares zoomed 4.6 per cent at 5287.10 per share on the BSE in Friday's intraday trade after the company informed the bourses that it has bagged a big work order worth Rs 513 crore

Updated On : 05 Jul 2024 | 12:50 PM IST

Market Highlights, July 5: RIL, SBI lead fag-end recovery; benchmarks end flat; HDFC Bank down 4%

Stock Market Highlights on July 5: Shares of RIL gained 2.58 per cent, helping the Sensex, and Nifty indices recoup losses

Updated On : 05 Jul 2024 | 3:47 PM IST

Modi govt's Budget to send India's soaring stocks higher, shows survey

The upcoming government budget will likely boost consumer spending and infrastructure building, which bode well for businesses, strategists and investors surveyed by Bloomberg said

Updated On : 11 Jul 2024 | 12:00 PM IST

FMCG sector weightage in Nifty 50 falls to lowest level since 2010

The Nifty FMCG index has been almost flat since and is up just the 0.3 per cent since the start of the 2024 calendar year

Updated On : 03 Jul 2024 | 11:23 PM IST

Mcap of BSE-listed firms hit record high of Rs 445.43 trn amid record rally

The 30-share Sensex hit the historic 80,000-mark for the first time earlier in the day. It surged 632.85 points, or 0.79 per cent, to hit a record intra-day high of 80,074.30

Updated On : 03 Jul 2024 | 6:00 PM IST

KEC International hits 52-week high on securing large order; details here

EC International's shares jumped 7.3 per cent to Rs 968.20 per share on the BSE in Wednesday's early morning trade

Updated On : 03 Jul 2024 | 9:54 AM IST

Namita Thapar-backed Emcure Pharma IPO opens: GMP, price, apply or not?

Emcure Pharmaceuticals initial public offering is set to open for subscription on Wednesday, July, 3, 2024

Updated On : 03 Jul 2024 | 11:44 AM IST

Stock Market Highlights, July 3: Sensex rises 545 pts, ends near 80,000; HDFC, Axis Bank gain 2%

Stock Market Highlights on July 3: In the broader markets, the BSE MidCap and the BSE SmallCap index rose 0.86 per cent each.

Updated On : 03 Jul 2024 | 3:52 PM IST

Hyundai India targeting to raise record $3.5 billion through IPO: Report

A representative for Hyundai India declined to comment. IFR and India media have previously reported the IPO could raise about $3 billion

Updated On : 02 Jul 2024 | 10:16 PM IST

L&T's shares rally on reports of order win worth $4 bn from Saudi Aramco

On Tuesday, the shares of Larsen Toubro soared up to 3 per cent at Rs 3,634 per share on the BSE in intraday trade.

Updated On : 02 Jul 2024 | 2:13 PM IST