Stock exchange:

Stock market trends help investors identify what stocks to buy and when. Learn about stock market trends and other investing at HowStuffWorks... ways to predict the rise and fall of the stock market. How do these traders and firms predict which shares will hit big? How do they know when to sell.
Inflation: Inflation is a rise in prices across the board. Inflation causes your dollar to be worth less. Inflation is the reason a car costs $7,000 in 1981 and $17,000 in 2001. Over the long term, inflation is good, because it means consumers are spending a lot of money -- the economy is robust. When inflation is too high, though, consumers pull back and spend less. After all, $5 is a lot of money to spend on a candy bar. When consumers spend less, companies don't make as much money. When companies don't make money, investors lose confidence in those companies. Many investors sell their stock because they believe the stock is worth less and is only going to decrease in price. As the demand for the stock decreases, the price of the stock decreases. When this happens to many companies in the stock market, the stock market experience a downward shift. Obviously, stocks and the stock market are important, but you may find that you know very little about them. What is a stock? What is a stock market? Why do we need a stock market? Where does the stock come from to begin with, and why do people want to buy and sell it? If you have questions like these, then this article will open your eyes to a whole new world!

Determining Valuelet’s say that you want to start a business, and you decide to open a restaurant. You go out and buy a building, buy all the kitchen equipment, tables and chairs that you need, buy your supplies and hire your cooks, servers, etc. You advertise and open your doors. You spend $500,000 buying the building and the equipment. In the first year, you spend $250,000 on supplies, food and the payroll for your employees. At the end of your first year, you add up all of the money you have received from customers and find that your total income is $300,000.

International and Domestic Issues: War tends to affect the stock market negatively. The same goes for crime, fraud, and domestic or political unrest. Consumers worry when CEOs steal money, terrorists kill innocent people, or politicians are involved in serious scandals. Who knows what will happen next? Consumers save their money. Businesses make less money. Investors tend to dump their stocks, causing a fall in the market.