ASSIGNMENT ON SHARE MARKET MELT DOWN

SENSEX-
Sensex is an index, an index is basically an indicator. It gives you a general i
dea about whether most of the stockshave gone up or most of the stocks have gone
down. The sensex is an indicator of all the prices of the major companies of th
e BSE(Bombay stock exchange)
HOW SENSEX IS CALCULATED
Sensex is calculated using a “market- capitalization weighted” methodology. As per t
his methodology, the level of index at any point of time reflect the total marke
t value of 30 components stock relative to a base period. (the market capitaliza
tion of a company is determined by multiplying the price of its stock by the num
ber of shares issued by the company).
NIFTY-
Nifty is an indicator of all the major companies of NSE. The Nifty index is a co
mposite of the top 50stocks listed on the National stock exchange. It is a simpl
ified tool which helps investors & ordinary people alike, understand what happen
s in the stock market & by extension, the economy.
BOMBAY STOCK EXCHANGE

The BSE or Bombay stock exchange sensitive Index is a value weighted index. Comp
osed of 30stocks with the base April 1979=100. It consists of the 30largest and
most actively traded stocks, representative of various sectors, on the BSE. Thes
e companies account for around one fifth of the market capitalization of the BSE
. The abbreviated from sensex was coined by Deepak mohoni around 1990 while writ
ing market analysis columns for some business newspaper. The index has increased
by over13 times from June 1990 to today.using information from April 1979 onwar
ds the long run rate of return on the BSE sensex can be estimated to be 0.52%per
week (continuously compounded) with a standard deviation of 3.67%.this translat
es to 27%per annum, which translate to roughly 18% pa after compensating for inf
lation.
SENSEX ON 26 SEP. 2008
NATIONAL STOCK EXCHANGE

The NSE of India limited was created on the basis of the report of the high powe
red study group on establishment of new stock exchanger,which recommended promot
ion of NSE by financial institution to provide access to investors from all acro
ss the country on an equal footing. In 1992, NSE was incorporated as a tax payin
g company unlike other stock exchange in the country. In April 1993,NSE was reco
gnized as a stock exchange under the securities contract(regulation) act,1956. T
he capital market (equities) segment commenced operation Nov. 1994 and operation
s in derivatives segment were started in June 2000. NSE launched s&p CNX NIFTY i
n April 1996.NSE is one largest interactive VSAT based stock exchange in the wor
ld. Presently it supports 3000 VSATS.
S&P CNX NIFTY
OBJECTIVE OF SENSEX

To measure market movements Benchmark for funds performance

For index based derivatives products

OBJECTIVE OF NSE

Establishing nationwide trading facilities for all types of securities . Ensurin

g equal access to investors all over the country through an appropriate telecomm
unication network. Providing fair , efficient & transparent securities market us
ing electronic trading system. Meeting international benchmark and standards.
MELT DOWN OF SHARE MARKET

Inflation in India is high, this will make production cost high and net profit d
own of companies . Unstable political condition –Left parties threatening to withd
raw support to the government and this cause a re-election and instability due t
o nuclear deal. International fuel price-Increasing fuel price is another reason
for fall,this cause production cost high for companies. Slow down US growth , d
ue to this many US investors withdraw their money from Indian market.
AMARICAN ECONOMY MAY ENTER A RECESSION

Falling house prices. Mortgage lenders going burst . Budget deficit . The sky ro
cketing Gasoline prices.
CONCLUSION
In
the ending of year 2007 , the sensex was increased very high.it reached at point
17000on sep.2007. I.e rising of sensex was to heavy investment of the foreign i
nvestors in Indian market. In the Jan. 2008 , sensex reached up to 21000 marks. Bu
t after that the sensex is going down very quickly because present time there is
no investment in the Indian market by foreign investors . BSE & NIFTY also shows
that sensex is falling down. On the other hand this fall down of sensex is best
opportunity for the investors so that in future when the sensex rise then the in
vestors will get maximum profit.
THANK YOU
QUERIES
?