The Indian Stock Market and the Macroeconomic Environment—an Overview

Abstract

We know that, the trading of shares and stocks takes place in the stock market. The price of these shares and stocks is determined by the demand and supply forces of the market. Earlier, the buying and selling of shares and stocks used to take place at a particular place, known as the stock exchange. Thus, the person had to go at that particular platform if he or she wanted to trade in shares. The security market is divided into two interdependent segments, namely, the primary market and the secondary market.

• The primary market provides the channel for creation of funds through the issue of new securities by companies, governments, or public institutions. In the case of new stock issue, the sale is known as an initial public offering.

• The secondary market is the financial market where previously issued securities and financial instruments—such as stocks, bonds, options, and futures—are traded.