- Indices represent different clusters of stocks/industries and the rise and fall in these indices’ values is a close representation of the market’s view on the stocks that make these indices. Hence, stock market news is cumulatively reflected in the movement of the index
- Simply put, an index represents the composite value of shares of different companies traded on a particular stock of exchange
- Till late 1980s, there was no index for India’s stock markets, till the Bombay Stock Exchange (BSE) introduced the ‘Sensex’ in 1986 (which represents composite share value of 30 selected companies trading in BSE).
- Later in the 1990s, the National Stock Exchange (NSE) introduced another index, popularly known as the Nifty (which represents composite share value of 50 selected companies trading on NSE)
Stock market indices provide us with a common measurement tool for the raise and fall in prices of shares that are traded on the index
First list of companies in BSE Sensex as on 01st January 1978
Companies in the BSE Sensex
Asian Cables Indian Organic
Ballarpur Industries Limited Indian Rayon
Bombay Burmah ITC
Ceat Limited Kirloskar Cummins
Century Textiles L&T
Crompton Greaves Mahindra & Mahindra
Glaxo Smithkline Pharma Mukand Iron
Grasim Nestle
GSFC RIL
Hindalco Scindia Shipping [4]
Hindustan Motors Siemens
HLL Tata Motors
Indian Hotels Company Tata Power
Indian Organic Tata Steel
Indian Rayon Zenith
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