Top 11 Factors that affect the stock market

Are you investing in the stock market. Then you should know the factors that affect the stock market to gain profit or good returns on investment.

Many people invest their money in the stock market, But many people don’t have knowledge about the stock market. So, Please gain knowledge about the stock market properly it will help to gain maximum profit from it.

According to Experts, Around 90% of beginners lose their money in the stock market due to a lack of knowledge. So, If you are a beginner in the share market then this article will help you understand the impact on it ( Factors that affect the stock market ).

What is the stock market?

The stock market refers to the buying and selling of the shares of companies between markets and exchanges. Such financial activities are conducted from the institutionalized formal exchanges or over the counter ( OTC ).

The stock market is a “high risk, high return investment”. It is popular in the overall world and many investors have created wealth from it.

Companies distributed the share among the public to get funds. However, On the other hand, the Public gets ownership of that company. You have the choice that you can invest in the company in which you like to invest.

The stock market is risky no doubt ( High risk, High returns investment ). But, If you select the best company and analysis the things perfectly. Then no doubts you will create wealth.

Suppose, you have selected 5 companies to invest in it. From those 5, 4 companies have performed best. It means you are the best investor. Let’s see, Factors that affect the stock market.

Factors that affect the stock market

Let’s see, what are the factors that affect the stock market? If will got that points or factors then you can keep safe your money by losing. The factors are followed below:-

Supply and demand

The law of supply and demand is applicable to the stock market. This is most important factor that affects the price of bitcoin.

The supply is more and demand is less, in this condition, the value of a share will fall and on the other hand, If the demand is more and supply is less, in this condition the value of the share will rise.

You should have normal knowledge about the supply and demand law. It will properly help you to gain profit in the share market.

Company related factors

It is obvious that if a corporation has public shares, then anything that’s happening within the corporate will directly affect the share price. This is one of the important factors that affect the stock market.

So, if the corporate is on the increase, with successful product launches, increased revenue, reduced debt, and more influx of investor capital, then the stock price of the corporate is sure to increase because everyone would want to shop for shares of such a corporation that’s going from strength to strength.

However, if the corporate is incurring losses, having product failures, amassing debt, then a majority of the shareholders would want to dump the shares of such a corporation, reducing the stock price.

Other factors that will make stock prices go up and down include changes within the management of the corporate, and mergers and acquisitions.


Politics is one of the major factors that affect the stock market - mini invest

The most important factor that affects the stock market. You will notice that when any political issue or any political work is going on then the volatility rises in the stock market. Due to the increase in volatility, the share market can go on both sides faster or sooner.

So, If you can take risks then you can trade and If you have knowledge and experience in the stock market then you can make the best profit in that trade while that time. Because when the movement started on one side then it can go on one side faster.

To take big movement in the stock market you should take risks and trade while this situation. Doing intraday trading in this situation can be very rewardly.

But, If you can’t take risks then don’t enter intraday trading because due to high volatility you can lose money in the stock market. To safe from loss please don’t enter in day trading.

If you don’t have knowledge about the stock market in deep then also you can lose your money in it. Many people have lost their money around 40% of their capital in a single day by doing intraday trading.

So, Politics is a one of the most important factors that affect the stock market. Doing day trading while this situation it contains high risk, high return.

Current Events

current events such as form submit of company, Spread of virus ( Covid-19 ), war between countries, protest of people, and many more factors that affect the stock market.

In this situation, the share market crashes. Market crashes means falling price or value of shares in the stock market. This is a major factors that affect the stock market.

So, In this situation you should avoid doing trade or investment according to me. The necessary thing to know while this situation is that you should put stop loss or keep place where you will exit the position if it goes against you.


Regulation which are create by the government of country related to the stock market this factors that affect the stock market. This are reason in the immediately volatility.

Mass media

According to Expert’s traders, Many people trade on the basis of news, tips, articles, social media, and many other places. They affect the price of either upwards or downwards.

In the world we work, The mass media influence every thing. So, Beware while negative news.

journalist and Experts

Journalist and Experts share their view to earn some money. But, Don’t do trade on that calculation because the information they provide is depend on that knowledge. If you knowledge then only enter in the trade on their analysis.

If you have knowledge then you can exit your position on time before taking big risk. This one one from, Factors that affect the stock market.

Natural Calamities

Calamities like earthquakes and floods drastically reduce the stock market price. This happens due to many reasons, like the destruction of property and other assets. This causes companies to incur heavy losses which leads to a falling in stock prices.

Company sales are affected due to a breakdown of the manufacturing and transport of goods. Therefore, when natural disasters occur, stock prices are bound to fall.

Last word from mini invest

I hope that you understand about the factors that affect the stock market. If you have any recommendation are feedback then leave it in the comment box below.

Give your Feedback, Comment and recommendation

%d bloggers like this: