First, I’ll give you the short answer!

Stocks are going up because more people want to buy than sell. When this occurs, they begin to pay higher prices than the stock is currently selling. In the other side of the same coin, stocks decline because more people want to sell than to buy. They are willing to accept a lower price in order to rapidly sell their shares.

Having said that, we’re going to look at the various reasons that make traders want to buy or sell a stock.

It is possible to look at the company’s financial statements to assess the valuation of the company. Investors who follow this approach are said to be questioning the “fundamentals” of the business. They are trying to find an undervalued stock-one that is selling below its “book value” value. They feel that, sooner or later, other traders will know that the business is worth more than the current price and start bidding.

Another investment psychology called the “scientific approach.” This is when traders closely study charts of past market results searching for patterns that they feel will be replicated in the near future. These traders are also looking at what is going on in the market as a whole, trying to forecast the impact that it would have on individual stocks.

Often businesses sell at half their “book value” and at other times they trade at double, triple or even higher. When this happens, there could be some unexpected and significant price swings. This uncertainty is what makes it possible to make big profits on the market. It is also responsible for tremendous losses.

The stock market is basically a massive auction where the ownership of large corporations is to be sold. If any investors think that a particular business is going to be a successful investment, they are willing to bid the price up. By the same way, if many buyers try to sell a stock at the same time, the supply will surpass demand and the price will decline.

Watching the stock market can be compared to watching a ball bounce. It goes up and down, and then it goes back up. This can be very frustrating for many investors who want to keep up with a steady trend. It is this instability of the market as a whole and of the individual stocks that the seasoned trader benefits from. In the absence of a lot of experience, an individual investor needs a proven source of knowledge and guidance. This need can be fulfilled by regular stock market recommendations from www.stock4today.com.

Many investors (as opposed to traders) have a “buy-and-hold” mentality. This will fit well in an ever-increasing market. Unfortunately, the stock market is not on a straight line. There are ups and downs that are upsetting this sort of investor. Nowadays many investors have become “traders” who buy and sell on the volatility of the economy and of individual stocks. These traders make money on every market-up or down!

Another well-known investing blog, www.fool.com, lists the following reasons why stocks are up and down:
Why stock is going up

• increasing revenue and earnings
• a wonderful new president who was hired to manage the company
• An innovative new product or service is being launched
• More innovative new products and services are planned
• The organisation is entering into a major new contract
• a big review of a new product in the newspaper or on TV.
• The company is going to break up its stock
• Scientists discover that the commodity is useful for something else.
• Some prominent investor buys shares
• A lot of people are buying shares
• Analyst upgrades the firm, changing its recommendation from for example, “buy” to “powerful purchase”
• Other stocks in the same industry are increasing
• The factory of the rival burns down
• The corporation defeats the court case
• More people are buying goods or services
• The business is expanding internationally and is beginning to sell in other countries
• Industry is “hot”—-People expect big things for good reasons.
• The industry is “hot”—-People don’t understand much about it but they still buy it.
• The company is being purchased by another company
• The company could be purchased by another company
• The company will spin-off part of itself as a separate company
• The rumours of
• not for any excuse at all

Why stock is going down

• profit slipping, revenue slipping
• The top executives are leaving the company
• A prominent investor sells the company’s shares
• Analyst downgrades his stock recommendation, maybe from “buy” to “hold”
• The company is losing a big client
• A lot of people are selling their shares
• The warehouse is burning down
• Other stocks in the same sector are going down
• Another company is launching a better product
• There is a shortage of materials, so not enough of the commodity can be made.
• a major case is brought against the company
• Scientists discover that the substance is not healthy
• Less people are buying the product
• The industry used to be “hot,” but now another industry has become more popular.
• Any new law can damage sales or profits
• A strong corporation is entering the market
• The rumours of
• For no excuse at all