DETERMINANTS OF EQUITY PRICES IN THE STOCK MARKET

Abstract

Stock exchanges are considered to be the most important component of the financial system of a country. Stock exchanges not only provide a plate form to the companies a mean to raise capital but act as a channel to circulate saving of the general public. Stock exchanges also provide a place who wants to invest their savings. In the stock markets the prices of the shares are determined by the forces of demand and supply. Prices are determined at the point of equilibrium. It is the case with the normal commodities but in case of the stocks many other forces work along with the forces of demand and supply. These forces may be economic, social and political (Sunde & Sanderson, 2009). The major focus of the researcher