stockmarket

Stock market refers to the collection of markets and venues where the buying, selling, and issuance of shares of publicly held companies takes place. It serves two main functions: mobilizing capital for companies through the sale of stock and providing a mechanism for price discovery, liquidity, and investment opportunities for individuals and institutions. In primary markets, companies issue new shares to raise capital; in secondary markets, investors trade existing shares among themselves.

Markets are composed of formal stock exchanges, such as those in New York, London, Tokyo, and others, as well as over-the-counter markets where less-liquid or smaller issues trade. Trading venues operate with listed rules, trading hours, and surveillance to reduce manipulation. Participants include individual investors, institutional investors, brokers, dealers, market makers, and custodians.

Trading mechanisms vary by venue but generally involve order-driven systems where buyers submit bids and sellers submit offers, with prices determined by supply and demand. Liquidity, market depth, and the bid-ask spread influence how easily trades can be executed. Prices reflect expectations about a company’s future performance, macro conditions, and broader economic factors. Indices such as the S&P 500 or FTSE 100 summarize broad market movements.

Regulation aims to ensure fair access, transparency, and investor protection. Regulators require disclosure from issuers, supervise trading practices, and prohibit manipulation and insider trading. The stock market has a long history of modernization and globalization, with exchanges expanding access through electronic trading and cross-border settlement.