The stock market is a financial marketplace where shares of publicly listed companies are bought, sold, and traded. It acts as a platform that allows companies to raise capital by offering ownership stakes, or "stocks," to investors. Investors, in turn, buy these shares with the goal of earning returns through price appreciation or dividends. The stock market is essential for the functioning of modern economies, as it provides businesses with the necessary funds for growth and development while offering individuals and institutional investors opportunities for wealth creation.
Stock exchanges, such as the New York Stock Exchange (NYSE) and Nasdaq, facilitate the buying and selling of shares, ensuring transparency, liquidity, and regulation. The performance of the stock market is often seen as a reflection of the broader economy, influenced by factors such as economic indicators, corporate earnings, geopolitical events, and investor sentiment.