Stock Market Research Paper

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Financial market plays a key and great role in the economy of any nation. It contributes in the economic development of country by encouraging capital formation and uplifting economic situation. Financial markets can be defined as the centers or arrangements that provide facilities for buying and selling of financial services. Security market is found within financial market and it is the place where people buy and sell financial instruments which is composed of debt and equity market, money and capital market, primary and secondary market, call and continuous market, spot and derivative market, organized stock exchange and OTC market, open and negotiated market and third and fourth market (Thapa, 2011). Capital market is the market for long term loans and equity capital.
The stock market plays a vital role in economic development of a nation, since it acts as mediator between borrowers and lenders. A well-function stock market will contribute to development of an economy through two important channels such as boosting saving and allowing for more efficient allocation of resources Baskin, J. (1989). Stock market is an important part of the economy of a country. The stock market plays a pivotal role in the growth of the industry and commerce of the country that eventually affects the economy of the country to a great
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Growth in stock index is normally considered as a good sign since it implies that the investors are confident about the future prospect of the economy. It helps promote investment in the economy. However, a rapid increase in the stock market index is always a matter of concern. Stock exchange market has multiple roles in an economy. It provides companies with the facility to raise capital for expansion through selling shares, raising capital for businesses, mobilizing savings for investment, facilitating company growth and creating investment opportunities for small
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