how to find reason for gaing and loosing of company in stock market?

[arvind n]

The reason why a firm moves up or down in the stock exchange is primarity due to demand/supply factors. Many people chasing one good firm is an example of demand. such firms will rise steadily. People trying to sell shares of a specific company will trigger a downward movement as shares are sold in excess. This is the first stage. the second stage is to identify why there is a demand or supply for this firm. this can be done by PEST analysis. It covers Political reasons, economic factors, social reasons and even technology factors. If we have an unstable political environment, people will pull out of stocks till a solid policy is announced by the government. Similarly, inflation, unemployment, GDP are some economic factors which influence the stock exchanges. If inflation is high, then people will pay more for products and shares will fall dependping on the affected industry. Y2K is an example of a technological issue which rocked the technology stocks in 1999-2000. Eeven social factors like culture affect Stocks. India does not permit KFC food outlet to function in some areas. This is an example of a cultural barrier. So keep watching how the new developments are happening, correlate them with PEST analysis and then go tothe third step. Know the fundamentals in and out. Keep watching whether sales and profits are rising for your stock. Keep watching their new projects and analyse the future target. I believe this will help you to master investing process. Remember, Pakistan stock ex crashed in 2007 during emergency. US crashed in 2007 on recession fears. Indian markets moved up on huge demands from foreigners. South Korea crashed due to US sanctions. Tracking these are as simple as reading newspapers. Do that. Happy new year and happy investing.