How tendencies influence stock prices

 

 

Macroeconomic Variables

 

The development of economic growth, employment rates, inflation; the construction of advantageous international trade and the stabilization of prices are some of the macroeconomic factors that directly influence the actions of the stock exchange. And for each of these factors, the market reacts in a different way.

The rise in interest rate; the gradual increase in inflation and even international crises; are directly related to the fall in assets in the stock market.

On the other hand; the growth of the economy manages to raise the value of the shares, since there is the GDP growth and the market gets warmer. Curiously, the national crisis scenario can also positively interfere with asset growth; since after a major downturn there can be a generous rise.

 

Sectoral variables

 

When investing in an action;  it is essential to analyze the expectations. Although the economy goes well or poorly, each area behaves differently and there are sectors that grow very heavily in crisis scenarios.

Therefore; it is very important to have a sense of what the growth prospects are for the market of a particular company and what can affect this evolution.

 

Market variables also influence stock prices

 

As it could not be;  everything that specifically affects the investment market will therefore influence the direct value of the shares. As an example; we can mention the increase of taxes and the changes in the standards for applications as factors that can both motivate and discourage the investment market.

 

Company behavior

 

This factor is strictly related to the chosen actions. It is always important to be aware of both the elements that influence an organization’s finances; such as changes in product prices or indebtedness, as well as changes in the expectation of future business and shareholder structure.

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