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PRESENTATION ON BRIEFHISTORY ABOUTSTOCK MARKET

Presented ByAnkush

AshutoshVijethaVishal

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Introduction

Astock market or equity market is a publicentity trading of company stock(shares)and derivatives at an agreed price; these

are securities listed on a stock exchange as well asthose only traded privately.

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Function and purpose

The stock market is one of the most importantsources for companies to raise money.

An economy where the stock market is on the riseis considered to be an up-and-coming economy.

Share prices also affect the wealth of householdsand their consumption.

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History

History of stock market trading in the United Statescan be traced back to over 200 years ago

Private banks began to raise money by issuing stocks,or shares of the company to raise their own money.

This was a new market, and a new form of investingmoney, and a great scheme for the rich to get richer.

A little further on the history tumeline, more

specifically in 1792, a meeting of twenty four largemerchants resulted into a creation of a market knownas the New York Stock Exchange(NYSE). At themeeting, the merchants agreed to meet daily on WallStreet to daily trade stocks and bonds.

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Further in history

In the mid-1800s, United States was experiencingrapid growth. Companies needed funds to assist inexpansion required to meet the new demand.

Companies also realized that investors would beinterested in buying stock, partial ownership in the

company

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History brought us the Industrial Revolution,which also played a role in changing the face of thestock market.

New form of investing began to emerge whenpeople started to realize that profits could be madeby re-selling the stock to others who saw value in a

company.

This was the beginning of the secondary market,known also as the speculators market

Hi I i S M T

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History o t e In ian Stoc Mar et - T eOrigin

18th Century

East India Company was the dominant institution and by end of the

century, business in its loan securities gained full momentum

1830's

Business on corporate stocks and shares in Bank and Cotton presses

started in Bombay. Trading list by the end of 1839 got broader

1840's

Recognition from banks and merchants to about half a dozen brokers

1850's

Rapid development of commercial enterprise saw brokerage business

attracting more people into the business

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1860's The number of brokers increased to 60

1860-61

The American Civil War broke out which caused a stoppage of

cotton supply from United States of America; marking thebeginning of the "Share Mania" in India

1862-63

The number of brokers increased to about 200 to 250

1865

A disastrous slump began at the end of the American Civil War(as an example, Bank of Bombay Share which had touched Rs.2850 could only be sold at Rs. 87)

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Pre-Independance Scenario - Establishment ofDifferent Stock Exchanges

1874 With the rapidly developing share trading business, brokers used

to gather at a street (now well known as "Dalal Street") for thepurpose of transacting business.

1875 "The Native Share and Stock Brokers' Association" (also known

as "The Bombay Stock Exchange") was established in Bombay

1880's

Development of cotton mills industry and set up of many others

1894

Establishment of "The Ahmadabad Share and Stock Brokers'Association"

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Cont.. 1880 - 90's

Sharp increase in share prices of jute industries in 1870's was followedby a boom in tea stocks and coal

1908

"The Calcutta Stock Exchange Association" was formed

1920

Madras witnessed boom and business at "The Madras Stock Exchange"was transacted with 100 brokers.

1923

When recession followed, number of brokers came down to 3 and theExchange was closed down

1934

Establishment of the Lahore Stock Exchange

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Cont.

1936

Merger of the Lahore Stock Exchange with the Punjab Stock Exchange

1937

Re-organisation and set up of the Madras Stock Exchange Limited(Pvt.) Limited led by improvement in stock market activities in SouthIndia with establishment of new textile mills and plantation companies

1940

Uttar Pradesh Stock Exchange Limited and Nagpur Stock ExchangeLimited was established

1944 Establishment of "The Hyderabad Stock Exchange Limited

1947

"Delhi Stock and Share Brokers' Association Limited" and "The Delhi

Stocks and Shares Exchange Limited" were established and later onmerged into "The Delhi Stock Exchange Association Limited"

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Post Independence Scenario

The depression witnessed after the Independenceled to closure of a lot of exchanges in the country.

Lahore stock Exchange was closed down after thepartition of India, and later on merged with theDelhi Stock Exchange.

Bangalore Stock Exchange Limited was registeredin 1957 and got recognition only by 1963.

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The Exchanges that were recognizedunder the Act were

Bombay

Calcutta

Madras

Ahmadabad

Delhi

Hyderabad

Bangalore

Indore

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Many more stock exchanges wereestablished during 1980's, namely:

Cochin Stock Exchange (1980)

Uttar Pradesh Stock Exchange Association Limited(at Kanpur, 1982)

Pune Stock Exchange Limited (1982) Ludhiana Stock Exchange Association Limited

(1983)

Gauhati Stock Exchange Limited (1984) Kanara Stock Exchange Limited (at Mangalore,

1985)

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Cont

Magadh Stock Exchange Association (at Patna, 1986)

Jaipur Stock Exchange Limited (1989)

Bhubaneswar Stock Exchange Association Limited

(1989) Saurashtra Kutch Stock Exchange Limited (at Rajkot,

1989)

Vadodara Stock Exchange Limited (at Baroda, 1990)

Coimbatore Stock Exchange

Meerut Stock Exchange

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