The stock market is a marketplace and just like any other marketplace there are buyers and sellers. Share prices change everyday because of market forces, mainly supply and demand. When more people want to buy a stock then that increases the demand and the price moves up. If there is more supply than demand then the price will move down. It is important to understand how share prices change because it can have a huge impact on your investment returns.
Investors also react to announcements from individual companies. These are known as Earnings or Trading Updates and they will tell investors how well a company has performed in the past and their outlook for the future. If a company announces positive results then it can make a share more attractive to investors and they may decide to buy the shares. Alternatively, if a company announces negative results then that can make investors nervous and they may sell their shares. If enough shareholders sell then the share price of that company will drop and this can have a big impact on the overall market.
This week rates moved higher and the curve flattened, fueled by strong economic data. Energy was the best performer while Comm Services and Consumer Discretionary lagged. Next week we are into month and quarter-end with a bunch of key economic data to be released including NFP on Friday.