Stock Market
The stock market is a place of trading of company stock, shares, and derivatives at an agreed price. For companies to raise money, the stock market is one of the most important sources. It allows businesses to be traded by selling shares of ownership of the company in a public market. History has shown that the price of shares is an important part of economic activity, and can influence or be the indicator of the social mood. An up- and- coming economy is an economy where the stock market is on the rise. At times the stock market can often be considered the primary indicator of a country's economic stability.
The stock market can be influenced by many different factors simultaneously. There is never one single factor that makes it rise or fall. Actually many different factors come together to cause the overall shift in the market. Investors planning to invest should be able know the factors that influence the future of the stock market.
The stock market can be influenced by many different factors simultaneously. There is never one single factor that makes it rise or fall. Actually many different factors come together to cause the overall shift in the market. Investors planning to invest should be able know the factors that influence the future of the stock market.
Corporate Results
This is one of the biggest influence on the stock market. Investors own a stock to participate in the profit of an organization. When corporate earnings grow stock prices will rise, but if earnings decline or growth slows the prices will fall.
The Economy
The economy is always changing. When the employment rates are low, and the economy is in a recesion, the profits of the corporations will decline. This will eventually cause the decline of the stock prices and overall lower the stock market in general. When the employment rates are high, the profits of corportation will increase. This will then lead to overall higher stock prices.
Geo-Political Changes
These changes also influence the stock market. Government regulations are oftenly changing causing an increase or a decrease in corporate profits. A change in a trade policy can greatly impact an entire comporation that does business internationally. Also the change in a government tax policy can infleunce the overall economy which then leads the affect in the stock market.
http://www.ehow.com/list_5919175_influences-stock-market_.html
http://www.ehow.com/list_5919175_influences-stock-market_.html
Investor Sentiment
Psychology plays a very important part in investing. Investors can either be very optimistic or very pessimistic. Investors play a big role in the stock market and since the value of a stock is overall based entirely on the law of supply and demand. For example when an investor is generally pessimistic about his/ her future then they will sell the stock, which will result in the market lowering. On the other hand if an investor is optimistic, they will buy stocks, resulting in the increase in the market.
Warren Buffett
In 2010, Warren Buffet was known to be the second richest in the United States. Warren has had not only one of the most successful, but also the longest stock markets careers in history. He is considered at times to be the "World's greatest value investor" or "The Oracle of Omaha" for his impressive investing. During his education at Columbia University, he studied under Benjamin Graham. Now chairman of Berkshire Hathaway, which Warren built from a textile company now makes annual gain in per-share book value. Warren Buffett follows the strategy that once was used by Benjamin Graham. Warren also follows the similar values of discipline and patience. Overall his moves were followed by thousands of other investors influencing the stock market. Warren Buffett's one single investment can shift the whole stock market rapidly. Thousands of investors wanting to make the same fortune or a part of it will purposely put into a certain stock just because of the fact of Warren Buffett's move.
