Stock Market is a place where the stocks of a listed company are traded. A single figure that sums up the overall performance of the market on a daily basis is the Stock Index. A good Stock Index captures the movement of the well diversified and highly liquid stocks. For a lay man it is the pulse rate of the economy. Index movements reflect the changing expectations of the stock market about future dividends of the corporate sector. The index is calculated by finding the weighted average of the prices of the most actively traded companies in the market, where the weights are generally in proportion to the market capitalization of the company. But when and where did it all start? Stock Exchanges as a centre for trading were established as early as the 16th century. In Antwerp, a major financial hub in Belgium, traders gathered together in 1531 to speculate in shares and commodities. This was the world's first Stock Exchange. London and Paris set up Exchanges sometime near the end of the 17th century. Close to hundred years later, in 1792, the New York Stock Exchange (NYSE) was established, which is still one of the world's most powerful exchanges today. The reason for establishment was primarily the need for financing businesses and for providing returns for the finances. In India, the Stock Exchange, Mumbai, was established in 1875 as "The Native Share and Stockbrokers Association" (a voluntary non-profit making association) and is now popularly known as the Bombay Stock Exchange (BSE). The other major exchange is the National Stock Exchange of India Limited (NSE) and was incorporated in November 1992. Combined the two trading zones are responsible for 99.9% of the trading done in India.
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