Indian Stock Market Exchanges & Indices

What is the Indian Stock Market

The Indian stock market is a general term used to categorize the trading activity that takes place in India.  The market can be traced back to the mid-1800s with the formation of the native share and stock brokers Association of Bombay.  The Indian stock market has recently been categorized as an emerging market since it is relatively new to many Westerners.  The exchange has been one of the strongest markets over the period from 1990 to 2007, where the Indian stock market saw its value increase more than 10 fold.

Components of the Indian Stock Market

The Indian stock market can be broken out into a number of key components.  Instead of drilling down into individual sectors or stocks, its best to look at the market from a macro level.  The easiest way for achieving this task is to think of the major indices and exchanges which are listed on the Indian Stock Market.

Exchanges

Bombay Stock Exchange

The largest and oldest index in the Indian Stock Market is the Bombay Stock Exchange (BSE).  This exchange has roughly 5,000 stocks and is the sister index to the New York Stock Exchange in the US.

National Stock Exchange of India

The National Stock Exchange (NSE) of India is the largest financial market in India that supports more than 3,000 Very Small Aperture (VSAT) terminals.  The NSE provided the first electronic limit order book for trading derivatives and ETFs.

Indices

Sensex

The Sensex is the oldest index in India and is responsible for tracking the 30 blue chip companies in the Indian market.  It is used as a gauge for the Indian stock market, much like the Dow Jones in the US.