Stock markets around the world have become highly correlated due to globalization. The document discusses several major stock exchanges including the New York Stock Exchange, NASDAQ, Bombay Stock Exchange, and London Stock Exchange. It analyzes the correlation between indices like BSE Sensex, Dow Jones, S&P500, and FTSE 100. The study finds the strongest correlation is between Sensex and the Hang Seng index, while the weakest is between Sensex and NASDAQ. It also examines the relationship between the BSE TECk index and NASDAQ.

1. INTRODUCTION
Stock markets are
highly correlated
in the era of
globalisation. The
world has became
a small global
village.

2. New York Stock Exchange.
•Origin - May 17, 1792,
•World's largest stock exchange by market capitalization of its
listed companies at US$14.242 trillion as of Dec 2011.
•Average daily trading value was approximately US$153 billion in
2008.
Introduction

3. NASDAQ
•The NASDAQ Stock Market originally stood for National
Association of Securities Dealers Automated Quotations.
•Founded 1971 by the National Association of Securities
Dealers(NASD)
•Second-largest stock exchange by market capitalization in the
world.
INTRODUCTION

4. The Bombay Stock Exchange -oldest exchange in Asia.
Bombay Stock Exchange (BSE), (Bombay Śhare Bāzaār) is a
stock exchange located on Dalal Street, Mumbai, Maharashtra,
India.
Established in 1875, BSE Ltd. (formerly known as Bombay
Stock Exchange Ltd)
BSE’s popular equity index - the SENSEX
BSE

5. The case study has been conducted by looking
into the nature of relationship between the daily
share price in BSE and NSE on the one hand
and Nasdaq and New York Stock Exchange on
the other, for 1999-2000 through 2000-2001.
CASE STUDY

6. Unidirectional casualty between Nasdaq and
Bse or Nse.
The same relationship as well as direction of
influence also holds good for the technology
segment of the New York Stock Exchange and
BSE or NSE.
 However, domestic prices of technology stocks
and overall domestic share prices were found to
be independent of each other
CASE STUDY

7. CORRELATION BETWEEN BSE-SENSEX AND OTHER SELECT INDICES
Indices Correlation T test results
level of correlation
Sensex & Dow Moderate
Sensex & NYSE Strong
Sensex & NASDAQ Weak
Sensex & S&P500 Weak
Sensex & HangSeng Strong
Sensex & Nikkei 225 Weak
Sensex & FTSE100 Moderate
Sensex & SSE Composite index Strong

8. Lowest correlation was recorded between
Sensex and NASDAQ.
The correlation of Indian stock market is weak
with NASDAQ and S&P500 of US market and
with Nikkei225 of Japanese stock market
Highest correlation was recorded between
Sensex and Hang Seng.
Conclusion

9. BSE TECk AND NASDAQ
BSE TECH
BSE TECk index was launched by Bombay Stock Exchange
provide a reliable index for benchmarking the
performance of the TMT (Technology
Media and Telecom) sectors in India
NASDAQ
NASDAQ stands for National Association of Securities Dealers
Automated Quotation
The NASDAQ Composite Index is the most
widely tracked technology stock index
in the world

10. It was proved that-
1. Both NASDAQ and BSE TECk financial series are non
stationary
2. Both the series are co-integrated
3. NASDAQ use to forecast BSE TECk
4. BSE TECk does not use to forecast NASDAQ
WHEN COMPARED THE BSE TECk AND NASDAQ

11. CONCLUSION
• So we can conclude that movement in NASDAQ causes movement
in BSE TECk.
•BSE TECk and NASDAQ are positively correlated
• Estimates that calculated will rarely match with the absolute
value that BSE TECk may reach a day after NASDAQ has
changed on prior date.
• Consequently, the estimated values should be used to identify
trend and not judge absolute value of BSE TECk on a particular day.

13. The London Stock Exchange,
or LSE, was formed around 300
years ago, and today lists
about 2,500 companies from
70 countries.
Many large U.S. companies
listed on American exchanges
also list on the London Stock
Exchange.
General Electric is one
example.
INTRODUCTION
LONDON STOCK EXCHANGE

14. LISTING
REQUIREMENTS
BSE LSE
Market Capitalization 250 million $700000
Number of float
shares
25% 25%
Accounting Standard Indian GAAP IFRS
Timeline on going
public
6 months 4 – 24 months
Equity market listing
fees
Rs. 20000 GBP million
LISTING REQUIREMENTS OF STOCK
EXCHANGE

15. FTSE 100 Index
5,937.33
-8.52 (-0.14%)
December 2011 to December 2012
FTSE 100 Index Chart

16. Bse Sensex
19,229.26
-126.00 (-0.65%)
December 2011 to December 2012
Bse Sensex Chart

17. Recent market conditions have affected investor confidence
and the number of new companies joining the markets across
the globe. Despite this, investor appetite in the Indian economy
and Indian companies has remained strong and continues to
grow.
There has been a significant increase in the trading of Indian
paper in London this year. Indian companies can take
advantage of this opportunity, it is a strong sign of the growing
investor interest for Indian companies in London and makes a
London listing even more attractive than before.
RECENT EVENTS

18. Comparison of
BSE SENSEX and UK FTSE

19. CONCLUSION
•The results indicate that macro economics
factor have significant affect on stock
exchange.
•It may affect the different industry positively
or negatively.
•Two industries namely Building Materials and
Merchants and Engineering suffer because of
exchange rate movements.

20. SHANGHAI STOCK EXCHANGE
LOCATION SHANGHAI, CHINA
FOUNDED
RE- ESTABLISHED
1891
1990
KEY PEOPLE GENG LIANG---CHAIRMAN
ZHANG YUJUN--- PRESIDENT
CURRENCY RENMINBI ( RMB )
1 RENMINBI 8.72 INDIAN RUPEE

21. FACTORS THAT BENEFIT BSE AGAINST
SSE
• Tax incentives
• Predictabiity
• Transparency
• Principles of international guidelines

22. FACTORS IN WHICH INDIA LAGS
BEHIND
• Nation of high savers
• High capitalisation
• Listed chinese companies are huge by Indian
standards
• Less of Foreign direct investment

23. • Shanghai announces 24 hour trading by
2020

24. INDIA AND CHINA’S PERFORMANCE IN THE
LAST 5 YEARS

25. Better corporate profitability
India’s equity capital markets
are more developed than
China’s
Greater exposure to the
private sector
India’s driver of economic
growth is consumption instead
of volatile exports.
REASONS FOR CHANGE IN LAST 5 YEARS

26. Effects on global economy and India
India and china are the two
emerging economies of Asia
Reduced investments by the
global investors in Asia.
Lower confidence among global
investors.
Reduced global growth rate.