Introduction

Stock markets refer to a market place where investors can buy and sell
stocks.The price at which each buying and selling transaction takes is
determined by the market forces (i.e. demand and supply for a particular
stock).Let us take an example for a better understanding of how market
forces determine stock prices.

ABC Co.Ltd. enjoys high investor confidence and there is an anticipation of

an upward movement in its stock price.More and more people would want to
buy this stock (i.e. high demand) and very few people will want to sell this
stock at current market price (i.e. less supply).Therefore,buyers will have to
bid a higher price for this stock to match the ask price from the seller which
will increase the stock price of ABC Co. Ltd.

On the contrary,if there are more sellers than buyers (i.e. high supply and
low demand) for the stock of ABC Co.Ltd. in the market,its price will fall
down.In earlier times, buyers and sellers used to assemble at stock
exchanges to make a transaction but now with the dawn of IT, most of the
operations are done electronically and the stock markets have become
almost paperless. Now investors dont have to gather at the Exchanges,and
can trade freely from their home or office over the phone or through
Internet.

One of the oldest stock markets in Asia,the Indian Stock Markets have a 200
years old history.East India Company was the dominant institution and by
end of the century, busuness inits loan securities gained full momentum later
business on corporate stocks and shares in Bank and Cotton presses started
in Bombay.

Different Stock Exchanges in India

(a) National Stock Exchange (NSE) of India

Integrated in November 1992,the National Stock Exchange of India (NSE)

was initially a tariff forfeiting association.In 1993,the exchange was certified
under Securities Contracts (Regulation) Act,1956 and in June 1994 it started
its business functioning in the Wholesale Debt Market (WDM).The Equities
division of NSE began its operations in 1994 while in 2000 the corporation
incorporated its Derivatives division.

Some NSE Figures and Facts:

•The equities division of NSE covers around 300 Indian cities,while its
derivates section covers 305 cities.

•The number of securities accessible for buying and selling in NSE

exchange in its equities and derivates section are 1,383 and 3,143
respectively.

•The total amount of Settlement warranty fund in NSE equities division and
derivates section are Rs2,085.25 crores and Rs 6,018.30 crores respectively.

•The daily turnover of NSE equities division is Rs 10,336.52 crores, for

derivates segment is Rs32,809.96 crores and for Whole sale debt division is
Rs 13,911.57 crores.

•NSE uses satellite communication expertise to strengthen contribution from

around 400 Indian cities.

•The exchange administers around rs 1 million of buying and selling on

daily basis.

•It is one of the biggest VSAT incorporated stock exchange across the
world.

•Currently more than 8,500 customers are doing online exchange business
on NSE application.

(b) Bombay Stock Exchange (BSE) of India:

The oldest stock market in Asia,BSE stands for Bombay Stock Exchange
and was initially known as "The Native Share & Stock Brokers
Association." Incorporated in the 1875, BSE became the first exchange in
India to be certified
by the administration. It attained a permanent authorization from the Indian
government in 1956 under Securities

Contracts (Regulation) Act, 1956.

Over the year, the exchange company has played an essential part in the
expansion of Indian investment market.At present the association is
functioning as corporatised body integrated under the stipulations of the
Companies Act.

Some BSE Figures and Facts

•BSE exchange was the first in India to launch Equity Derivatives, Free
Float Index, USD adaptation of BSE Sensex and Exchange facilitated
Internet buying and selling policy

•BSE exchange was the first in India to acquire the ISO authorization for
supervision, clearance & Settlement

•BSE exchange was the first in India to have launched private service for
economic training

•Its On-Line Trading System has been felicitated by the internationally

renowned standard of Information Security Management System.

(c) Regional Stock Exchanges (RSE) of India

The Regional Stock Exchanges in India started spreading its business

operation from 1894.The first RSE to start its functioning in India was
Ahmedabad Stock Exchange (ASE) followed by Calcutta Stock Exchange
(CSE) in 1908.The stock exchange in India witnessed a flourishing phase in
1980s with the incorporation of many exchanges under it. In early 60s, it has
only few certifies RSEs under it namely Hyderabad Stock Exchange, Indore
Stock Exchange, Madras Stock Exchange, Calcutta Stock Exchange and
Delhi Stock Exchange. The recent to join the list was Meerut Stock
Exchange and Coimbatore Stock Exchange.