Stock Exchange Market?

Question

Can anyone explain me (in simple words) what do all those graphs, curves, percentages, ups and downs in a Stock Exchange Markets reports mean ??

i.e. Dow: down 0.30 %, Nasdaq: down 0.39%

Please help...I'm stupid

Answer 1

Well, there are beelions and beelions of individual stocks out there and the question is: how did it all go today? So, some magicians pick a group of stocks that they think are representative of the market, come up with a formula, and calculate how that group did today. The most common are the Dow Jones Industrials (DJIA) and the NASDAQ 100. Today (Friday 2/23), the DJIA was at 12647.48, down 0.3% from yesterday. There is an old saying that a rising tide lifts all boats, and it is true that individual stocks will move with the market, but when you plot charts of individual stocks against the DJIA or NASDAQ, over a period of a few months it seems that there is almost no correlation. The moral of this is that the DJIA is all they have time to mention in the evening news and the person telling it to you doesn't know a thing about it anyway. It is just all he has time to say. Pick the stocks, not the averages.

Answer 2

You are not stupid you are intellegent that is why you kept out of these stock market for long. Only if you have speculative income like those in the Western countries you need to worry about investing in Stocks.
Graphs represents the state of the Stock Market on any particular day. Like we have states good moods, bad moods etc; stock prices on any day can all go high or some other day it can come down. When they go up then the graphs go up and when they come down the graphs come down. Graphs are created on a few representative stocks called the 'Blue Chip' stocks. Their movement pretty much sums up the mood of the whole stock market. If it says Nasdaq moved up 30% it means the market index created out of the Bluechip stocks has gone up by 30%. Down 39% means it has gone down by 39% from the previous days trading. Stock exchanges are afterall the places where stocks are traded like Nasdaq, NYSE, Amex, FTSE, CAC etc. Stock indexes are created out of Bluechip stocks as I said earlier. It is just like creating the Consumer Price Index. Based on a base year at which the index will be one to higher levels as time goes by. Instead of a basket of goods and services here they use a basket of stocks like IBM, Exxon etc;.
Mathew Cherian

Answer 3

Let's asume Dow is an apple and NASDAQ is an orange and you are at Wal-Mart.

It's monday.
Dow $100.00
NASDAQ $50.00

You go again on tuesday to check the price.
Dow $90.00
NASDAQ $45.00

As you can see the price went down 5%

I cannot explain it any simpler.