New York Stock Exchange and Capital Market

8/10/2019 New York Stock Exchange and Capital Market

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By-Pratik , Jitesh, Jagruti, Siddhita, Reshma.


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Profile of NYSE Stock market concept

Origin of NYSE

History of NYSE

Brief timeline of NYSE Major companies in NYSE

Crashes along with their reasons and effects

Mergers

Capital market Classification of issues

Bibliography


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Location U.S.

Founded

Owner

CEO

Currency

No. of Listing Co.

Market Capital

Website

New York city

March 8, 1817.

NYSE Euronext

Duncan L. Niederauer

US

2800 aprox.

US 13.39 Trillio ( Dec 2010)

www.nyse.comn
http://www.nyse.comn/http://www.nyse.comn/


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A stock market is a public entity for the trading ofcompany stock (shares) and derivatives at an agreedprice; these are securities listed on a stockexchange as well as those only traded privately.


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Back to over 200year ago U.S. decided to finance thewar by selling the bonds, and government notespromising to payout at profit at a later date.

At the same time pvt. Bank began to raise money byissuing stock or shares of the company to raise theirown money.


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NYSE started in 1792.

In start only five securities traded.

In 1817, the rules & regulations was

developed. Anthony Stockholm was elected the first

president of exchange.

First set trading hours were estd in 1873.

Dow Jones industrial average with a startingvalue of 90.

Crashes over the years effect on the NYSE.


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1792 - Twenty-four brokers and merchantsgathered on Wall Street to sign the ButtonwoodAgreement. The NYSE is born!

1792 - Bank of New York becomes the first listed

company on the NYSE. 1903 - April 22, the NYSE moved into 18 Broad

Street. (This building is still in use today.)

1918 - The pneumatic vacuum tube system is made

for sending tickets to and from differentdepartments.

1929 - October 23: Black Thursday.October 26: Blue Monday (Market loses $26 billionin value.)


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1953 - October 10: Trade volume on the NYSEreaches900,000 shares, this marks the last day that thedaily volume of the NYSE is under 1 million shares.

1967 - NYSE admits its first woman member. 1987 - October 19: Black Monday (Market drops

508 points, the largest one-day drop in history.)

1992 - May 17: the NYSE celebrates its 200th

anniversary. 1996 - May 7: The highest price ever paid for a

membership is $1,450,000


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1.ExxoMobil Corp(XOM)Market Cap: $329B

2. Petro China (PTR)Market Cap: $237B

3. BHP Billiton(BHP)Market Cap:$222B

4.Petrobras (PBR)Market Cap:$210B

5.HSBC Holdings (HBC)Market Cap:$206B

6. Wal-MartStores(WMT)Market Cap:$203B

7.China Mobile (CHL)Market Cap:$191B

8. Royal Dutch Shellplc(RDS.A)Market Cap: $190B

9. BHP Billiton plc (BBL)Market Cap:$187B

10. BP Plc (BP)Market Cap: $186B


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In Oct 24, 1929 was known as a BlackThursdaystockprices fell sharply by a volume of about 13million shares. Five days later, October 29th, 1929, themarket crashed by a volume of over 16 million shares.At the time this was the highest volume drop that was

not to be matched for 39 years. This crash marked thebeginning of the Great Depression.


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Reason behind the crash:-

Stocks were overpriced.

Federal Reserve policies were causing disagreement andproblems.

Many people had an overconfidence from the 20's whichinfluenced a search for easy money and made many peoplegreedy.

Many people took their chances in the market by "buying

on a margin". This means that they bought stocks onborrowed money, money they did not have. They would bemaking money as long as their stock price increased, but ifthe prices fell then they would be deep in debt.


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In Oct 19 1987 was known as Black Monday because theNYSE dropped 508 points, the largest one-day fall in history.From October 14 to October 19th of 1987 the major parts ofthe market dropped around 30% or more.


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Some explanations for the causes of the crash:

Computer trading securities-many analysts say this is thecause. Computers in large investing companies wereprogrammed to order large numbers of stocks when certainmarket trends prevailed.

Liquidity- trading mechanisms in the stock market were unableto deal with such a large flow of sell orders.

Trade and Budget deficits-trade and budget debts during thethird quarter of 1987 might have led investors into thinkingthat these debts would cause the crash.


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Euronext and NYSE Group:-

NYSE Group bid8 billion in cash and shares for Euronexton May 22, 2006.

The new firm, tentatively dubbed NYSE Euronext, would beheadquartered in New York City.

NYSE CEO John Thain, who would head NYSE Euronext.


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NYSE Euronext and Deutsche Brse:-

The new company becoming the world's largest stockexchange operator with a market capitalisation of listedcompanies equal to US$15 trillion.

President and deputy CEO of NYSE Euronext DominiqueCerutti would become the new company's president.

Deutsche Brse shareholders will have 60% ownership ofthe new entity, and NYSE-Euronext shareholders will have40%.


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The nature of capital market is brought out by thefollowing facts:

It Has Two Segments

It Deals In Long-Term Securities

It Performs Trade-off Function It Creates Dispersion In Business Ownership

It Helps In Capital Formation

It Helps In Creating Liquidity


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The capital market constitute of two members , i.e. the

lenders and the borrowers, without which the marketwouldnt function

Lending and borrowing of capital is nothing but supply anddemand of money

The function of lending and borrowing should balance outitself to maintain growth and stability in the economy

Following indications are affected as a mismatch in lendingand borrowing

1. Liquidity2. Growth3. Cost of capital4. Inflation5. Credit6. Gold prices7. Bond yields8. Market sentiment


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CAPITALMARKET

PRIMARYMARKET

PUBLICISSUE

RIGHTISSUE

BONUSISSUE

PRIVATEPLACEMENT

SECONDARYMARKET

STOCKMARKET


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It Is Related With New Issues It Has No Particular Place

It Has Various Methods Of Float Capital: Following arethe methods of raising capital in the primary market:

i) Public Issueii) Offer For Sale

iii) Private Placement

iv) Right Issue

v) Electronic-Initial Public Offer It comes before Secondary Market


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It Creates Liquidity It Comes After Primary Market

It Has A Particular Place

It Encourage New Investments


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Issues

Further PublicOffering

Fresh

Issue

Initial PublicOffering

PrivateplacementRight

Public

Offer for

sale

Offer for

sale

Fresh

Issue


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The Indian Capital Market is one of the oldest capital

markets in Asia which evolved around 200 years ago. Chronology of the Indian capital markets

1830s: Trading of corporate shares and stocks in Bankand cotton Presses in Bombay.

1850s: Sharp increase in the capital market brokersowing to the rapid development of commercialenterprise.

1860-61: Outbreak of the American Civil War and' Share Mania ' in India.

1894: Formation of the Hamada Shares and StockBrokers Association.

1908: Formation of the Calcutta Stock ExchangeAssociation.


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Capital market investment takes place through the bondmarket and the stock market.

The capital market is basically the financial pool inwhich different companies as well as the governmentcan raise long term funds.

Capital market investment that takes place through thebond and the stock market may be elucidated in thefollowing heads.


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The stock market is basically the trading ground capitalmarket investment in the following:

i) Companysstocks

ii) Derivatives

iii) Other securities

The capital market investments in the stock market take placeby:

1) Small individual stock investors

2) Large hedge fund traders.

The capital market investments can occur either in:

1) The physical market by a method known as the openoutcry.

2) Trading can also occur in the virtual exchange wheretrading is done in the computer network.


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The bond market is a financial market where the participantsbuy and sell debt securities. The bond market is also differently known as the debt, credit

or fixed income market. There are different types of bond markets based on the

different types of bonds that are traded. They are:

1. Corporate,2. Government and agency,3. Municipal,4. Bonds backed by mortgages & assets,5. Collateralized Debt Obligation.6.

The capital market investment in the bond market is doneby:7. Institutional investors8. Governments, traders and9. Individuals.


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Investment in long term financial instruments isaccompanied by high capital market risks.

Since there are two types of Capital markets- the Stockmarket and the Bond market.

So risks are present in both the market.


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Pratik-From slide 1 to 8Jitesh-From 9 to 15

Reshma-From 16 to 19

Siddhita-From 20 to 24Jagruti-From 25 to 30

Documents

New York Stock Exchange and Capital Market