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Q62 (IAS/2000) Economy › Industry, Infrastructure & Investment › Stock market indices Answer Verified

A rise in ‘SENSEX’ means

Result
Your answer: —  ·  Correct: C
Explanation

SENSEX is the benchmark index of the Bombay Stock Exchange (BSE) and is calculated using the free-float market capitalisation of 30 well-established (blue‑chip) companies listed on BSE. Therefore, a rise in the SENSEX indicates an overall rise in the market value (and hence prices) of that specific group of companies included in the index, not a simultaneous rise across every company listed on BSE or on the National Stock Exchange (NSE) [1]. Stock exchanges are platforms where only listed securities trade, and indices reflect aggregate movements of their constituent securities rather than every security on the exchange [2].

Sources

  1. [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Bombay Stock Exchange > p. 276
  2. [2] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > STOCK EXCHANGE > p. 275
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