mani

A study on impact of rupee devaluation in indian stock market with reference to BSE SENSEXIntroduction :-Established in 1875,BSE Ltd.(formerly know as Bombay stock exchange Ltd). IS Asias first stock exchangeand one of india s leading exchange groups. Over the past 137 years. BSE has facilitated the growth of the indian corporate sector by providing it an efficient capital rising platform.popularly known as BSE.the bourse was established as The Native Share&Stock brokers association in 1875.BSEis corporatized and demutualised entity. With abroad share holder base which includes two leading global exchange . deutsche bourse and singapore exchange as a strategic partners. BSE provide efficient and transparent for trading in equity, debt instruments,derivatives,mutualfunds. It also as a platform for trading in equities of small and medium enterprises. More than 7000 companies are listed on BSE making it worlds No. 1 exchange in terms of listed members.BSE also provides a host of other services to capital market paticipant including risk management,clearing,settlement,market data services and educatio . it has a global reserch with customer around the world and nation wide presence.BSE system and process are designed to safe guard market integrity,drive the growth of the indian capital market and stimulate innovation and competition across all market segments.BSE is the first exchange in india and second in the world to obtain an ISO 9001:2000 certification . it is also the first exchange in the country and second in the world to receive information security management system standard BS 7799-2-2002 certification for its on- line trading system (BOLT). It operates one of the most respected capital market educational institutes in the country (the BSE institute Ltd.). BSE also provides depository services through its central depository services ltd services.

BSE s popular equity index the S&P BSE SENSEX - is indias most widely tracked stock market benchmark index . it is traded internationally on the EUREX as well as leading exchange of the BRCS nations (Brazil,Russia,and china ,southafrica ).BSE has own several awards and recognizations that acknowledge the work done and progress made like the golden peacock Global CSR award for its initiatives in corporate social responsibility, NASSCOM -CNBC-TV18 s IT user award s,2010 in financial service category, skoch virtual corporation 2010 Award in the BSE STAR MF category and responsibility Award by world council of corporate governance. Its recent milestones include the launching of BRICSMART indices derivatives ,BSE-SME exchange platform, S&P BSE GREENEX to promote investment in green india .Affects Stock Prices :Stock market prices are affected by business fundamentals company and world events,human psychology, and much more stock trading is driven by psychology just as much as it is by business fundamentals ,belive it or not . fear and greed are the two of strongest human emotions that affect the market .for example it is to get caught in the trap of selling of stock permturely because it dipped temporarily and fear set in . on the other hand ,it is also easy to miss out on a respectable gain because greed was telling you to hold out or more, and then the stock drops back down.

one of the main business factor in determining a stocks prices is a compny s earning including the current earnings and estimated future earnings. news from the company and other national and world events also plays a large role the direction of stock market .some examples of this are oil prices ,inflation and terrorist attacks.every analyst and trader has a different perception of what that stock price should be now and where it might be in the future and trading decisions are made accordingly.Bad News or "Good" Bad News? Layoffs This is usually good for the company and its stock price because expenses will be reduced significantly and quickly. This should help increase earnings right away. It is not always a major warning sign; it could just be a reaction to a slower economy. It is one of the quickest ways a company can cut expenses if sales have not been meeting expectations. Store Closings This event often causes the stock price to go up for the same reasons as layoffs. However. this is not always the case. Closing stores actually requires a lot of money, and the positive effects of it do not take place immediately. This could be a sign that the company is truly in trouble at the moment. They probably have lower sales and higher expenses than they want, possibly due to a slowdown in the industry or the overall economy. The good news is that their management is being pro-active about maintaining profitability. Unfortunately, the stock price may go down for the next few months. Firing of CEO or Company Official This may sound very negative at first, but it does show that the company's board of directors was bold enough to take drastic actions to help the company in the long run. The stock price could go up or down after this announcement, depending on the situation. In some cases this event could be a sign of corruption that reaches beyond these individuals and there could be more negative announcements to come. Market Scandals Trader tend to frown upon corruption in the stock market. Mutual fund scandals that have occurred in the past few years and corporate corruption such as Enron are two such examples. If people cannot trust the stock market. why would they investtheir hard-earned money in it? In these situations it is harder for the market to go up because there is a lower demand for stocks. Analyst Recommendations Many traders rely on experts' opinions about companies and future stock prices. Are they always correct? Of course not. Nobody can predict what will happen in the future. They can, however. make educated guesses based on past performances and future prospects for the companies and industries they follow. Round Numbers Traders often like nice round numbers for their perceived stock price, such as $10.00 or $35.00. It is common for prices to settle near these round numbers, at least briefly. Also, many traders place automatic buy or sell orders right near these round numbers, causing the stock price to become slightly erratic when it first reaches that target. Technical Analysis One of the most popular methods for helping predict a .stock's price, at least in the short term, is called Technical Analysis. This method involves looking for patterns or indicators in stock prices, volumes, moving averages, and many others, over time. Obviously nobody can predict the future but this method can be effective in many cases because human beings are somewhat predictable. For example, when people see a stock start falling dramatically they often panic and sell their positions without investigating what caused the fall. This causes even more people to sell their shares and this often leads to an "overshoot" of the stock price. If you believe the price went too far down you can try to buy it at the bottom and hope that it will come back up to a more reasonable level. Another common example involves Moving Averages. Man) traders like to chart the 50-day and 200-day moving averages of their stock prices along with the prices themselves. When they see the current price cross over one of these Moving Averages on the charts it can be an indicator of a change in a long-term trend and it may be time to buy (or sell) the stock. Fundamental analysis : Is a term for several methods of forecasting the market value of a company and movement of FX rates based on the analysis of financial and production indicators. Fundamental factors have a significant impact. but they do not give hundred-percent guarantee of the desired changes in quotations. Before openimg a position it is necessary to examine the trends and only then decide in which direction it is better to open position When working in the financial markets technical and fundamental analyses are used. Both types of analyses try to predict the future movement of prices. The difference between them is that fundamental analysis looks at the market in terms of the economy than from the standpoint of the functioning of the market (technical analysis). The school of fundamental analysis of the market came into existence during development of the applied economic science. It has taken knowledge of the macro-economic life of society and its impact on prices of specific goods as a base. The main task of the school of fundamental analysis is to develop and forecast new trends in price movements, therefore, a purpose of fundamental analysis is an analysis and prediction of fundamental factors and their impact on price trends.

The concept of a currency rate and the basic concepts. Exchange rate is the value of the currency of one country expressed in the currency of the other country, precious metals, securities.Types of exchange rates are the following: By control method: fixed exchange rate: flexible exchange rate: floating exchange rate: By type of the market: current rate SPOT (TOD i TOM): forward rate; futures rate: market and the weighted average rate. Outwardly. the exchange rate is the coefficient recalculation of one currency in the other determined by the ratio of supply and demand in the foreign exchange market. However, the cost basis of the exchange rate is the purchasing power of currencies expressing the national average prices of goods. services. investment. This economic category is intrinsic to commodity production and expresses productive relationships between producers and the world market. As the cost is a comprehensive expression of economic conditions of commodity production, then comparability of national currencies of various countries is based on the value ratio, which is made up during process of production and exchange. Producers and buyers of goods and services using the exchange rate of national prices compare with prices in other countries. As a result of the comparison, the extent of the benefits of the development of production in the country or external investment is exposed. No matter how the law of value is distorted, the exchange rate is subject to its action, and expresses correlation of the national and world economy, where the actual ratio of exchange rates is reflected. When selling products on the world market, a product receives public recognition based on international measures of value. Thus, the exchange rate mediates absolute exchange products in the world economy. The cost basis of the exchange rate is due to the fact that international prices of production, Which are the base for the world prices. osounded on the national prices of production in the countries that are major suppliers to the world market. The exchange rate is needed for: Mutual exchange of currencies for trade in goods, services, capital movements and credits. Exporter exchanges the proceeds in foreign currency exchanges Ibr the national one as currencies of other countries cannot be treated as purchasing and payment means on the territory of the state. Importer exchanges a foreign currency to pay for the goods purchased abroad. Debtor buys a foreign currency to repay the national debt and interest payments on external loans; Compare of prices of the world and national markets as well as the cost parameters of different countries, expressed in the national or foreign currencies; periodic reassessment of the company and bank accounts in foreign currencies. The exchange rate regime Is the way a country manages its currency in respect to foreign currencies and the foreign exchange market. It is closely related to monetary policy and the two are generally dependent on many of the same factors. There are administrative and market regimes. The administrative regime Is in the plural form of exchange rates, i.e. it is existence of differentiated exchange ratios for different types of currency transactions, commodity groups and regions. The administrative regime is used as a stabilization step during a crisis to reduce inflation and to accumulate gold and currency reserves. Introduction of administrative regime is an temporary step towards the normalization of the economic situation in the country and the transition to market conditions of forming exchange rate. For the first time such a regime was used during the economic crisis of 1929-1933.

The Market regime is divided into three types: Fixed regime. It is a regime in which countries have a pegged or fixed rate. Such countries fix the value of its currency ith no possibility of rejection or with very narrow limits (less than 1%) of such deviations from the other or combine currency . Leaders in the list of standard rates to which the national currency is tied. are the U.S. dollar and euro. As an example of 100% fixation is the European 11nion. They have fixed the exchange rates of their national currencies within the Eli relative to other currencies and euro as of the last business day in 1998 and adhered to the exchange ratio till the final adoption of euro.as A regime in which countries have limited flexibility of exchange rates. It is such a regime, when officially specified ratios between the national currencies which allow minor fluctuations are formed. The currency-corridor regime belongs to this type. i.e. forming the limits of currency fluctuations in order to stabilize the monetary system. A regime with high flexibility of the courses. Exchange rates can move freely, changing under the influence of factors of supply and demand, etc. Such a regime has subcategories: Free float (freely fluctuating); Managed floating (managed fluctuating); Exchange rate that is periodically adjusted. Factors that affect exchange rates. Like any price, the exchange rate deviates from the cost basis - the purchasing power of currencies under the influence of supply and demand of currency. The ratio of the supply and demand depends on several factors. It reflects connections with other economic categories - cost, price, money, interest, balance of payments, etc. There is a complex of interweaving and nomination of decisive factors. Among them are the following.The rate of inflationThe ratio of currency in their purchasing power (purchasing power pail)) sen cs as a kind of axis of the exchange rate reflecting the law of\ alue. That's wh) the rate of inflation has an impact on the exchange rate. All other things being equal. the inflation rate in the country has inversely proportional impact on the value of national currency. i.e. an increase in inflation in the country leads to a reduction in the national currency. and vice versa. Inflationary depreciation of money in the country reduces the purchasing power and a tendency to a drop in their currency's exchange rate against currencies of countries where the rate of inflation is lower. Alignment of the 'exchange rate and adjustment to purchasing power parity are occurred within two years. This is because the daily quotation of exchange rates is not corrected on the basis of their purchasing power, and there are other factors of forming of exchange rates. The balance of payments.

Balance of payments directly affects the value of the exchange rate. Thus, the active balance of payments improves the national currency as the demand from foreign debtors increases. The passive balance of payments leads to a tendency to a decrease in the national currency's exchange rate as domestic debtors try to sell everything using a foreign currency to repay their external obligations. The size of the impact of balance of payments on the exchange rate is determined by the degree of openness of the economy. Thus, the higher the share of exports in gross national product (the higher the openness of the economy), the higher the elasticity of the exchange rate. In addition, the exchange rate affects economic policy of the state in components of the balance of payments: current account and capital account. For example, the effect of changes in tariffs, import restrictions, trade quotas, export subsidies has an impact on the trade balance. When the positive balance of trade is on the advance there is an increase in the demand for the currency of the country that raises its rate, and in case of negative balance the reverse process occurs. Movement of short-term and long-term capital depends on the level of domestic interest rates, restrictions or encourage of import and export of capital. Changes in the balance of capital have an impact on the currency, which is similar to the trade balance by its mark (plus or minus). However, there is a negative influence of excessive short-term capital inflows into the country on the rate of its currency because it can increase the Acess money supply, which, in turn, may lead to higher prices and the depreciation of the currency.

The difference in intrest rates in different countriesThe influence of this factor on the exchange rate is explained by two many factors. First. changes in interest rates in a county) affect. all else being equal. international capital flows, especially short-term ones. In principle. an increase in the interest rate stimulates the inflow of foreign capital and its cutting promotes the reduction of outflow of capital. including national. That is why in a country with higher interest rates capital comes into. the demand for its currency increases. and it becomes expensive. The movement of capital, especially speculative "hot" money. increases instability of the balance of pa) ments. Secondly. interest rates affect the operation of foreign exchange markets and money markets. When executing transactions, banks take into account the difference in interest rates on national and global capital markets with a view of deriving of profit. They prefer to get cheaper loans in foreign money markets, where rates are lower, and place foreign currency on the domestic credit market, if its interest rates are higher. On the other hand, the nominal increase in interest rates in the country reduces the demand for domestic -currency as receipt of credits becomes expensive for business. In case of taking out a loan, an entrepreneur increases the cost of their product that. in turn, leads to higher prices for goods inside the country. This relatively devalues the national currency against a foreign one.

Activities of foreign exchange markets and speculative currency transactions. If the rate of a currency tends to decline firms and banks sell it for a more stable currency and it worsens the position of weakened currency. Currency markets react quickly to changes in the economy and politics, fluctuations in exchange ratios. In doing so, they increase opportunities of currency speculations and spontaneous movement of money

The degree of confidence in the national and world currency markets. It depends on the economy and political situation in the country as well as the factors indicated above which affect the exchange rate. Dealers take into account not only the rate of economic growth, inflation, the purchasing power of currencies, the balance of demand and supply of currency, but the prospects of their dynamics. Sometimes, even the expectation of the publication of official data on the trade balance and the balance of payments or election results affects the ratio of supply and demand and currency rate. Sometimes, in the currency market there is a change of priorities in favor of political news, rumors of resignations of ministers, etc.The monetary policy. The ratio of market and state regulation of the exchange rate affects its dynamics. The formation of the exchange rate on foreign exchange markets through the mechanism of demand and supply of currency is usually accompanied by sharp fluctuations in exchange relations. Real exchange rate forms in the market which is an indicator of the economy. money. finance. credit and confidence in a certain currency. State regulation of the exchange rate is aimed at its raising or lowering on the basis of the purposes of monetary and economic policy.National income is not an independent component that can change itself. However, in general. the factors which lead to changes in the national income have a great impact on the exchange rate. Thus. an increase in the supply of products enhances the exchange rate, while increases in domestic demand reduce its rate. In the long run. a higher national income means higher value of the currency of the country.

Market factors. These factors can significantly change the value of currency at short intervals. Thus, the overall expectations for future economic growth, changes in fiscal and foreign trade deficits directly affect the exchange rate. In addition, the foreign exchange market participants' expectations have a significant impact on the value of the exchange rate. Seasonal peaks and downs of business activity in the country have a significant impact on the rate of national currency. FIXING THE VALUE OF THE CURRENCY IS DUNE IN WHAT BASIS : Internal Developments Developments that can occur within companies will affect the price of its stock, including mergers and acquisitions, earnings reports, the suspension of dividends, the development or approval of a new innovative product, the hiring or firing of company executives and allegations of fraud or negligence. Stock price movements will be most drastic when these internal developments are unexpected. World Events company stock prices and the studk market in general can be affected by world events such as war and civil unrest, natural disasters and terrorism. These influences can be direct and indirect. and they.often occur in chain reactions. The social uncertainty and fear generated by the terrorist attacks on Sept. I I. 2001. affected markets directly as they caused many investors in the United States to trade less and to focus on stocks and bonds vdth less risk. An example of an indirect influence on markets is the announcement of a new military venture by a country in response to the outbreak of civil unrest or conflict abroad. This announcement likely would cause the price of the stocks of military equipment and weapons manufacturers to rise due to an expected increase in defense. contracts. hich in turn can raise the value of stocks for companies that supply military equipment parts and technology. It likely would raise the demand for, and price of, natural resources used to make these parts, which would raise the price of stocks representing particular mining and natural resource processing companies.

Inflation and Interest Rates One of the more predictable influences of the stock market are periodic adjustments of interest rates by the U.S. Federal Reserve to combat inflation. When interest rates are raised, many investors sell or trade their higher risk stocks for government-backed securities such as bonds to take advantage of the higher interest rates they yield and to ensure that their investments are protected. Exchange Rates Foreign currency rates have a direct impact on the price and value of stocks in foreign countries, and changes in exchange rates will increase or decrease the cost of doing business in a country, which will affect the price of stocks of companies doing business abroad. While long-term movements in exchange rates are affected by fundamental

Market forces of supply and demand and purchase price parity, short-term movements are driven by news, events and futures trading and are difficult to predict. Hype Stocks and the stock market also can be affected by hype about a company or the release of new products or services.

Many people and organizations have an interest in promoting particular stocks and industries to increase the value of their own shares and profits. and positive financial reports and stock market newsletters. Internet blogs. press releases and news reports can build high expectations for the performance of companies. which will raise the price of their stocks. This can occur even when the hype has no foundation in truth: investors are wise to consider peoples reaction to hype rather than analyze the merits of the positive promotion.rnrnll)pe (and its opposite) can be advanced by respected stock market authorities such as Warren Buffet, Peter Lynch and hedge fund investor and financial speculator George Soros; such is the respect given to these individuals skill and past success that they sometimes can affect the movement of markets by simply suggesting that developments might occur. The foreign exchange market (forex, FX, or currency market): Is a global decentralized market for the trading of currencies. The main participants in this market are the larger international banks. Financial centers around the world function as anchors of trading between a wide range of multiple types of buyers and sellers around the clock, with the exception of weekends. The foreign exchange market determines the relative values of different currencies.111 The foreign exchange market works through financial institutions, and it operates on several levels. Behind the scenes banks turn to a smaller number of financial firms known as "dealers." who are actively involved in large quantities of foreign exchange trading. Most foreign exchange dealers are banks, so this behind-the-scenes market is sometimes called the "interbank market", although a few insurance companies and other kinds of financial firms are involved. Trades between foreign exchange dealers can be very large, involving hundreds of millions of dollars.1"i" needed' Because of the sovereignty issue when involving two currencies, Forex has little (if any) supervisory entity regulating its actions. The foreign exchange market assists international trade and investments by enabling currency conversion. For example, it permits a business in the United States to import goods from the European Union member states, especially Eurozone members, and payeuros, even though its income is in United States dollars. It also supports direct speculation and evaluation relative to the value of Market 11M currencies, and the carry trade. speculation based on the interest rate differential between two currencies. In a typical foreign exchange transaction. a party purchases some quantity of one currency by paying for some quantity of another currency. The modern foreign exchange market began forming during the 1970s after three decades of government restrictions on foreign exchange transactions (the Bretton Woods system of monetary management established the rules for commercial and financial relations among the world's major industrial states after World War(II). when countries gradually switched to floating exchange rates from the previous exchange rate reeime. which remained fixed as per the Bretton Woods system. The foreign exchange market is unique because of the following. characteristics: Its huge trading volume representing the largest asset class in the world leading to high liquidity; Its geographical dispersion; Its continuous operation: 24 hours a day except weekends, i.e., trading from 22:00 GMT on Sunday (Sydney) until 22:00 GMT Friday (New York): The variety of factors that affect exchange rates; The low margins of relative profit compared with other markets of fixed income; and ; The use of leverage to enhance profit and loss margins and with respect to account size. As such. it has been referred to as the market closest to the ideal of perfect competition, notwithstanding currency intervention by central banks. According to the Bank for International Settlements, the preliminary global results from the 2013 Triennial Central Bank Survey of Foreign Exchange and OTC Derivatives Markets Activity show that trading in foreign exchange markets averaged $5.3 trillion per day in April 2013. This is up from $4.0 trillion in April 2010 and $3.3 trillion in April 2007. Foreign exchange swaps were the most actively traded instruments in April 2013, at $2.2 trillion per day, followed by spot trading at $2.0 trillion. According to the Bank for International Settlements, as of April 2010, average daily turnover in global foreign exchange markets is estimated at $3.98 trillion, a growth of approximately 20% over the $3.21 trillion daily volume as of April 2007. Some firms specializing on foreign exchange market had put the average daily turnover in excess of US$4 trillion. The $3.98 trillion break-down is as follows: HistoryCurrency trading and exchange first occurred in ancient times Money-changing people. people helping others to change mono and also taking a commission or charging a fee were lip ing in the times of the talmudic writings (Biblical times). these people (sometimes called "kollybistes") used city-stalls. at least times the temples Court of the Gentiles instead. Money-changers were also in more recent ancient times silver-smiths and, or. gold-smiths During the fourth century. the Byzantium government kept a monopoly on the exchange of currency. Currency and exchange was also a vital and crucial element of trade during the ancient world so that people could buy and sell items like food, pottery and raw materials. If a Greek coin held more gold than an Egyptian coin due to its size or content, then a merchant could barter fewer Greek gold coins for more Egyptian ones. or for more material goods. This is why the vast majority of world currencies are derivatives of a universally recognized standard like silver and gold. Medieval and later During the fifteenth century the Medici family were required to open banks at foreign locations in order to exchange currencies to act on behalf of textile merchants. To facilitate trade the bank created the nostro (from Italian translated "ours") account book which contained two columned entries showing amounts of foreign and local currencies, information pertaining to the keeping of an account with a foreign bank. During the 17th (or 18t) century Amsterdam maintained an active forex market.' During 1704 foreign exchange took place between agents acting in the interests of the nations of England and Holland. Early modern Alex. Brown & Sons traded foreign currencies exchange sometime about 1850 and was a leading participant in this within U.S.A. During 1880 J.M. do Espirito Santo de Silva (Banco Espirito e Comercial de Lisboa) applied for and was given permission to begin to engage in a foreign exchange trading business. The year 1880 is considered by at least one source to be the beginning of modern foreign exchange, significant for the fact of the beginning of the gold standard during the year. Prior to the First World War there was a much more limited control of international trade. Motivated by the outset of war countries abandoned the gold standard monetary system. Modern to post-modern I mill 1899 to 1913. holdings of countries' toreign exchange increased at an annual rate of while holdings of gold increased at an annual rate of 6.3% between 1903 and 1913. At the time of the closing of the year 1913. nearly half of the world's foreign exchange was conducted using the Pound sterling. The number of foreign banks operating w ithin the boundaries of London increased in the years from 1860 to 1913 from 3 to 71. In 1902 there were altogether two London foreign exchange brokers In the earliest years of the twentieth century trade was most active in Paris. New York and Berlin. while Britain remained largely uninvolved in trade until 1914. Between 1919 and 1922 the employment of foreign exchange brokers within London increased to 17. in 1924 there were 40 firms operating for the purposes of exchange. During the 1920s the occurrence of trade in London resembled more the modern manifestation, by 1928 forex trade was integral to the financial functioning of the city. Continental exchange controls, plus other factors, in Europe and Latin America, hampered any attempt at wholesale prosperity from trade for those of 1930's London During the 1920s, the Kleinwort family were known to be the leaders of the foreign exchange market; while Japheth. Montagu & Co.. and Seligman still warrant recognition as significant FX traders. After WWII After WWII, the Bretton Woods Accord was signed allowing currencies to fluctuate within a range of 1% to the currencies par. In Japan the law was changed during 1954 by the Foreign Exchange Bank Law, so, the Bank of Tokyo was to become, because of this, the centre of foreign exchange by September of that year. Between 1954 and 1959 Japanese law was made to allow the inclusion of many more Occidental currencies in Japanese forex U.S. President Richard Nixon is credited with ending the Bretton Woods Accord and fixed rates of exchange, eventually bringing about a free-floating currency system. After the ceasing of the enactment of the "Bretton Woods Accord" during 1971, the Smithsonian Agreement allowed trading to range to 2%. During 1961-62, the amount of foreign operations by the U.S. Federal Reserve was relatively low. Those involved in controlling exchange rates found the boundaries of the Agreement were not realistic and so ceased this in March 1973, when sometime afterward none of the major currencies were maintained with a capacity for conversion to gold, organisations relied instead on reserves of currency. During 1970 to 1973 the amount of trades occurring in the market increased three-fold. At some time (according to Gandolfo during FebruaryMarch 1973) some of the markets' were "split", so a two tier currency market was subsequently introduced, with dual currency rates. This was abolished during March 1974. Reuters introduced during June 1973 computer monitors, replacing the telephones and telex used previously for trading quotes.

Markets close

Due to the ultimate ineffectheness of the Bretton Woods Accord and the European Joint Float the fore\ markets were forced to close sometime during 1972 and March 1973. The very largest of all purchases of dollars in the history of 1976 was when the West German government achieved an almost 3 billion dollar acquisition (a figure given as 2.75 billion in total by The Statesman: Volume 18 1974). this event indicated the impossibility of the balancing of exchange stabilities by the measures of control used at the time and the monetary system and the foreign exchange markets in "West" Germany and other countries within Europe closed for two weeks (during February and. or. March 1973. Giersch, Paque, & Schmieding state closed after purchase of "7.5 million Dmarks" Brawley states "... Exchange markets had to be closed. When they re-opened ... March 1 That is a large purchase occurred after the close.

After 1973 The year 1973 marks the point to which nation-state, banking trade and controlled foreign exchange ended and complete floating, relatively free conditions of a market characteristic of the situation in contemporary times began (according to one source)) although another states the first time a currency pair were given as an option for U.S.A. traders to purchase was during 1982, with additional currencies available by the next year. On 1 January 1981 (as part of changes beginning during 1978 the Bank of China allowed certain domestic "enterprises" to participate in foreign exchange trading Sometime during the months of 1981 the South Korean government ended forex controls and allowed free trade to occur for the first time. During 1988 the countries government accepted the IMF quota for international trade. Intervention by European banks especially the Bundes bank influenced the forex market, on February the 27th 1985 particularly. The greatest proportion of all trades world-wide during 1987 were within the United Kingdom, slightly over one quarter, with the U.S. of America the nation with the second most places involved in trading. During 1991 the republic of Iran changed international agreements with some countries from oil-barter to foreign exchange

Market size and quality

- Foreign exchange market turnover. 1988-2007, measured in billions of USD. The foreign exchange market is the most liquid financial market in the world Traders include large banks, central banks. institutional investors, currency speculators. corporations, governments, other financial institutions, and retail investors. The average daily turnover in the global foreign exchange and related markets is continuously growing. According to the 2010 Triennial Central Bank Survey, coordinated by the Bank for International Settlements, average daily turnover was US$3.98 trillion in April 2010 (vs $1.7 trillion in 1998).1410f this $3.98 trillion, $1.5 trillion was spot transactions and $2.5 trillion was traded in outright forwards, swaps and other derivatives.

Review of literature: (Gauan deep Sharma) This paper's contributions are as IblItms. First by embracing a stud) period that extends beyond January 2008, this paper provides the first attempt to analyze the health of stock market near to the elections. The time period examined by existing studies on time series behaviour of BSE do not cover the post election period. Naka(1990) employed a vector error correction model (VECM) (Johansen (1991)) in a system of five equations to investigate the presence of cointegration among these factors. analyzed a negative relationship between interest rates or inflation and stock prices, and a positive relation between output growth and stock prices. Sharma (2008) tests weak form of efficiency of the BSE. Bhattacharya (2001) by applying the techniques of unitroot tests, cointegration and the long run Granger non causality test recently proposed by Toda and Yamamoto (1995), tests the causal relationships between the BSE Sensitive Index and the five macroeconomic variables, viz.. money supply, index of industrial production, national income, interest rate and rate of inflation using monthly data for the period 1992-93 to 2000-01. They found that (i) there is no causal linkage between stock prices and money supply, stock prices and national income and stock prices and interest rate, (ii)index of industrial production lead the stock price, and (iii) there exists a two way causation between stock price and rate of inflation. (Dr. Nikhil Saket) The rupee's decline affects everyone in the economy because it feeds directly and indirectly into general inflation, which is a continuing problem even as output growth decelerates, and therefore hits common people hard. There are several ways in which the falling rupee immediately has an inflationary impact, one of the most important of which is the price of energy. The govt should concentrate On correcting the economic fundamentals rather than indulge in soap operas in a run up to the election. A better co-ordination with RBI is required rather than blame game. Apart from all the political parties should come together in fixing the problem and getting back the investors' confidence. Brahman and Uddin (2009) examined the relationship between exchange rates and stock prices of three emerging countries of South Asia named as Bangladesh, India and Pakistan. They considered average monthly nominal exchange rates of US Dollar in terms of Bangladeshi Taka, Indian Rupee and Pakistani Rupee and monthly values of Dhaka Stock Exchange General Index, Bombay Stock Exchange Index and Karachi Stock Exchange All Share Price Index for period of Januar. 2003 to June 2008 to conduct the study Franck and Young (1972) show that there is no significant interaction between exchange rate and stock price dynamics. Aggarwal (1981) discussed the relationship between exchange rates of US Dollar and changes in the indices of US stock prices and found a positive correlation. Giovannini and Jorion (1987) also considered the exchange rates and stock prices of USA and supported the conclusions of Aggarwal (1981). Two conclusions can be drawn based on the empirical analysis. Firstly, there is no inter-relation between the daily returns in the foreign exchange and the stock market of India for the period January 2006 to March 2012. The time period was also divided into three sub periods; first from 2006-09, second from 2008-10 and the third from 2009-12. The same conclusion was arrived at for these subsequent periods too. Secondly, factors like India-U.S. inflation differential. lending interest rate, current account deficit (as a percentage of India's GDP) and percentage change in India's public debt were found to be significantly linked to the exchange rate. (Santosh Kumar) The contagion linkages between forex market and stock market have been the focus area of research in recent times. Cause-effect and transmission relationship between these two markets has gained significant importance with the advent of globalization, financial market deregulation and opening up of the economy. developments in the emerging equity markets in Asia and Latin America and their contagion effect, and find that the herding behavior and heterogeneous macroeconomic fundamentals across the economies are the major contributory factors for the degree of transmission effect. Badhani (2005) examines the relationship among stock prices, dollar-rupee exchange rate and net FII investment in India and reveals a long-term relationship between FII capital flow and stock prices and exchange rate. However, the study does not conclude upon any longterm relationship between exchange rate and stock prices.

Capital Market: A financial market consists of primary and secondary markets. A primary market is where new securities are initially placed and distrihuted. A secondary market is where securities arc bought and sold after initial distribution. The most tradable financial instruments on the financial markets are shares and bonds. Shares are certificates of ownership that represent a shareholder's share in a joint stock company's equity. Equity is defined as capital permanently used in business which does not have to be paid out unless the enterprise is in liquidation. The term is often used to mean the shareholders' ownership. Some types of shares are: common. preferred. and employee share Common shares confer voting rights at the Stockholders' Annual General Meeting (AGM) and a dividend. if the company makes a profit and the AGM decides a dividend is to be paid. Preferred shares do not confer voting rights at the AGM. but have priority when it comes to dividend payments. Companies typically issue preferred shares when they want additional financing, but not new owners able to take part in decision-making. We distinguish: Cumulative shares, which confer the right to accumulate unpaid dividends, as well as priority over common shareholders with regard to dividend payments; Participating shares, which grant the right to certain priority dividends, as well as common shareholder dividends; And Participating-cumulative shares, which combines the rights of both types. Bonds are typically long-term debtor securities, with a maturity of at least a year, bought on the market by investors looking for income in the form of interest. They are sold by issuers looking for financing. issuers may be the state (state bonds), cities (municipal bonds), or enterprises (corporate bonds). Bonds are extremely attractive securities, since they form the basis for acquiring interest at known time internals. while the resources invested in the purchase ma). depending on the type of bond. be returned on maturity. or in installments together with the interest. Capital markets also deal in other forms of security. including options. futures. forwards. warranties. etc. An Option is a contract that grants the holder the right. without obligation. to buy (call option) or sell (put option) a specified amount of financial instruments at a pre-negotiated price during a defined period of time. We distinguish the purchase or sale of financial instruments on maturity (European option) from sale both before and on maturity (American option). Forwards and futures are sales contracts at a future, specified date and a given price. They are typically used to protect from the market risk of price or exchange rate instability. All these instruments are traded on capital markets and are therefore called: capital market instruments. The total market value of securities is their market capitalization. It is the product of a security's market price and the total number of securities. Each security has a nominal and a market value. The nominal (par) value is the value a security is issued at, i.e. the value written on it and -t specified at the time of issue. The security's real value is, however. usually different from its nominal value. The market value is the value as determined on the financial market. If a share's market value is higher than its nominal value, the investor has achieved a positive financial result, known as "aggio" in finance. The opposite case is termed "disaggio. Besides capital income, people invest in securities to secure the dividend obtainable for a given security. The dividend is that part of a company's net profit that is distributed to shareholders. We distinguish dividends paid in money from dividends in shares

STOCK MARKET: The market in which shares of publicly held companies are issued and traded either through exchanges or over-the-counter markets. Also known as the equity market. the stock market is one of the most vital components of a free-market economy, as it provides companies with access to capital in exchange for giving investors a slice of ownership in the company. The stock market makes it possible to grow small initial sums of money into large ones. and to become wealthy without taking the risk of starting a business or making the sacrifices that often accompany a high-paying career. Investopedia explains 'Stock Market' The stock market lets investors participate in the financial achievements of the companies whose shares they hold. When companies are profitable, stock market investors make money through the dividends the companies pay out and by selling appreciated stocks at a profit called a capital gain. The downside is that investors can lose money if the companies whose stocks they hold lose money, the stocks' prices Goes down and the investor sells the stocks at a loss. The stock market can be split into two main sections: the primary market and the secondary market. The primary market is where new issues are first sold through initial public offerings. Institutional investors typically purchase most of these shares from investment banks. All subsequent trading goes on in the secondary market where participants include both institutional and individual investors. Stocks are traded through exchanges. The two biggest stock exchanges in the United States are the New York Stock Exchange, founded in 1792, and.the Nasdaq, founded in 1971. Today, most stock market trades are executed electronically, and even the stocks themselves are almost always held in electronic form, not as physical certificates. If you want to know how the stock market is performing, you can consult an index of stocks for the whole market or for a segment of the market. Examples include the Dow Jones Industrial Average, Nasdaq index, Russell 2000, Standard and Poor's 500, and Morgan Stanley Europe, Australasia and Far East index. Research methodology: Research design : (Explanatory research ) The way in which researchers develop research designs is fundamentally affected by' whether the research question is descriptive or explanatory. It affects what information is collected. Accurate descriptions of the level of unemployment or poverty have historically played a key role in social policy reforms

Factors involved: Stock. BSE. rupee valuation Research period Last one year Collection of data: From secondary sources like company web Sites, Articles. Hypothesis: H1: Currency Fluctuations Influence (High) Stock Market Performance. H2: Currency Fluctuations Influence (Low) Stock Market Performance. Objective of the study: To explore the major macro economic ariables for rupee devaluation. To study the eticet of macroeconomic variables on stock prices. Need of the study: In the changed economic scenario study India like developed country should have international stability to face the global computation. International currency value is very important for a sustainable foreign trade development. If currency price changes are predictable the foreign trade can gain maximum profits. So study enables to understand impact of rupee devaluation in Indian stock market. By which man's investors can understand the investment pattran maximum benefits. Scope of the Study: Study is based on 12months of lyear in 2014. Study based on available information for lyear. > It covers information given by sum authors, journals, websites, etc... Problem Statement: Rupee valuation stability not incurred. Last Sys change has been remarkable (from 2014 -40s 2015-70s). Statement of problem is whether the rupee devaluation has effect on Indian stock market.

Stock market :

DateOpenHighLowCloseAvg Vol

3 Jan, 201421,222.1921,409.6620,343.7820,513.859,100

3 Feb, 201420,479.0321,140.5119,963.1221,120.129,300

3 Mar, 201421,079.2722,467.2120,920.9822,386.2718,800

3 Apr, 201422,455.2322,939.3122,197.5122,417.809,100

3 May, 201422,493.5925,375.6322,277.0424,217.3416,000

3 Jun, 201424,368.9625,735.8724,270.2025,413.7813,300

3 Jul, 201425,469.9426,300.1724,892.0025,894.9710,900

3 Aug, 201425,753.9226,674.3825,232.8226,638.118,600

3 Sep, 201426,733.1827,354.9926,220.4926,630.518,400

3 Oct, 201426,681.4727,894.3225,910.7727,865.838,800

3 Nov, 201427,943.0428,822.3727,739.5628,693.999,900

3 Dec, 201428,748.2228,809.6426,469.4227,499.428,800

Currency prices

MonthOpenHighLowClose

3-Jan61.90562.01259.14961.125

3-Feb62.56563.02160.82259.215

3-Mar61.83161.94756.45950.201

3-Apr51.96553.21650.02151.012

3-May60.32561.54854.21359.456

3-Jun59.20560.56457.26160.213

3-Jul59.52162.89754.93261.021

3-Aug60.21461.12653.97459.562

3-Sep60.02562.02559.54361.021

3-Oct61.21363.01260.82261.412

3-Nov61.89563.54656.58462.394

3-Dec62.32563.23560.12569.897

H1 : CURRENCY FLUCTUATIONS INFLUENCE (HIGH) STOCK MARKET PERFORMANCE Model SummaryModeRR SquareAdjusted R SquareStd. Error of the Estimate

1.389.1510.672728.65994

A .Predictors : (Constant),Q_1 CURRENCY FLACTIONS(HIGH)B.Dependent Variable :Q_3 STOCK MARKET PERFORMENCE(SENSEX)Interpretation : The Summary part of the output is most useful when you are performing multiple regressions (Which we are NOT doing.) Capital R is the multiple correlation coefficent that tell us how strongly the multiple independent variables are related to the dependent variable. In the simple bivariate case (what we are doing) R =|r| (multiple correlation equals the absolute value of the bivariate correlation.) R square is useful as it gives us the coefficent of determination

ANOVAModelSum of SquaresDfMean SquareFSig.

Regression

Residual

Total13294010.297

74455850.762

87749861.0591

10

1113294010.297

7445585.0761.785.211

a. Dependent variable : Q_3 STOCK MARKET PERFORMENCE (SENSEX)b. Predictor: (constant), Q_1 CURRENCY FLACTIONS (HIGH)The ANOVA basically tells us whether the regression equation is explaining a statistically significant portion of variability in the dependent variables. The Above table shows that the sum of squares 13294010.297. the f value 1.785 and asymmetric significant value . 211. So at 5% level of significant p value is insignficant (p>0.05). Those hypotheses Currency Fluctuations influence (high) Stock Market performence as been rejected. It means there is no impact of changes in currency value performence of stock market.

Coefficients Modelun StandardizedcoefficientStandardizedcoefficientT

Sing.

BStd.errorBeta

(constant)Q_1 currency flactations(high)5635.328

220.2129888.971

164.802

.389.570

1.336.581

.211

DEPENDET Variable : Q_3 STOCK MARKET PERFORMENCE(SENSEX)

The Coefficents part of the output gives us the values that we need in order to write the regression equation . the regression equation will take the form predcted variable (dependent variable) =slope * independent variable +intercept The slope is how steep the line regression line is. A slope of 0 is a horizantal line,a slope of 1 is a diagonal line from the lower left to the upper right ,and a vertical line has an infinite slope. The intercept is where the regression line strikes the Y axis when the independent variable has a value of 0.

The predicted variable is the dependent variable given under the boxed table . in this case it is I d rather stay at home than go out with my friends. The slope is found at inter section of the line labled with the independent variable (in this case extravert) and the coloumn labeled B. In this case example , the slope equals 220.212 The independent variable was extravert (we specified that when we set up the regression.) The intercept is found at the intersection of the line labled (constant) and the column labled B.in this example,the intercept is 5635.328, puttin it all together , the regression equation is : predicted value of I d rather stay at home than go out with my friends = 220.212 X value of extravert +5635.328.

H2 : CURRENCY FLUCTUATIONS INFLUENCE(LOW)STOCK MARKET PERFORMENCE Model Summary ModelRR SquareAdjusted R SquareStd.Error of the Estimate

1.424.180.0982682.61486

a. Predictors : (Constant), Q_2 CURRENCY FLACTIONS (LOW)b. Dependent variable : Q_3 STOCK MARKET PERFORMENCE(SENSEX)

Interpretation

The Model Summary part of the output is most useful when you are performing multiple regression (which we are NOT doing.) Capital R IS the multiple correlation coefficent that tells us how strongly the multiple independent variables are related to the dependent variable are related . in the simple bivariate case (what we are doing) R =| r| (multiple correlation equals the absolute value of the bivariate correlation.) R square is useful as it gives us the coefficent of determination.

ANOVA

ModelSum of SquaresDfMean SquareFSig.

Regression

Residual

Total15785636.454

71964224.605

87749861.0591

10

1115785636.454

7196422.4612.194.169

a. Dependent Variable:Q_3 STOCK MARKET PERFORMENCE (SENSEX)

b .PREDICTORS:(Constant),Q_2CURRENCY FLACTIONS(LOW)

interpretation: The ANOVA basically tells us whether the regression equation is explaining a statistically significant portion of the variability in the independent variables. The above table shows that the sum of squares 15785636.454, the f value 2.194 and asymmwetric significant value. 169 So at 5% level of significant p value is insignificant (p>0.05). Those currency Fluctuations influence (low) stock market performance it means there is no impct of changes in currency value performence of stock market. Coefficient

ModelUnstandaRized coefficentS.D coefficentTSig.

BStd errorBeta

(constant)

Q_2 CURRENCYFLACTIONS(LOW)-352.162

331.41212959.408

223.767

.424-027

1.481.979

.169

a. Dependent variable: Q_3 STOCK MARKET PERFORMENCE (SENSEX)

Interpretation: The coefficents part of the output gives us the values that we need in order to write the regression equation. The regression equation will take the form: Predicted variable (dependent variable)=slope * independent variable +intercept The slope is how steep the line regression line is. A slope of 0 is a horizantal line, a slope of 1 is digonal line form the lower left to the upper right, and a vertical line has a infinite slope. The intercept is where the regression line strikes the Y axis when the independent variable has a value of 0. The predicted variable is the dependent variable given under the boxed table. In this case it is i d rather stay at home than go out with my friends. The slope is found at the inter section of line labeled with the independent variable (in this case extravert) and the coloumn labled B. In this example , the slope equals 331.412 the independent variable was extravert (we specifide that when ew set up the regression.) The intercept is fpund at the intersection of the line labled (constat)and the coloumn labled B. In this example, the intercept is -352.162. Putting it all together , the regression equation:

Predicted value of i d rather stay at home than go out with my friends = 331.412X value of extravert +352.162

FINDINGS : Currency Fluctuations Influence (high) Stock Market Performance: If Stock market performance is negative either at higher value which is contrast to m) assumption that the Stock market performance is positive at higher and negative at lower. The Model Summary part of the output is most useful when you are performing multiple regressions. Capital R is the multiple correlation coefficients that tell us how strongly the multiple independent variables are related to the dependent variable. In the simple bivariate case (what we are doing) R=Ir I (multiple correlation equals the absolute value of the bivariate correlation.) R square is useful as it gives us the coefficient of determination. The sum of squares 13294010.297, the f value 1.785 and asymmetric significant value .211. So at 5% level of significant p value is insignificant (P>0.05). Hypotheses Currency Fluctuations Influence (high) Stock Market Performance as been rejected. It means there is no impact of changes in currency value performance of stock market. Currency Fluctuations Influence (low) Stock Market Performance That the sum of squares 15785636.454, the f value 2.194 and asymmetric significant Value .169 so at 5% level of significant p value is insignificant (P>0.05). Those Currency Fluctuations Influence (low) Stock Market Performance it means there is no impact of changes in currency value performance of stock Market.

Conclusion: In the Study Mutable regression model is employed to test for effects of micro economic factors on stock price on the period of March 2014. Macroeconomic variables used in this study are foreign exchange reserve, exchange rates. Stock Market Performance (high) will be taken and used in Spss package in Anova table value .21 I . So at 5% level of significant p value is insignificant (P>0.05) so Hypotheses Currency Fluctuations Influence (high) Stock Market Performance as been rejected. It means there is no impact of changes in currency value performance of stock market.and also will be taken Stock Market Performance (low) asymmetric significant Value .169 so at 5% level of significant p value is insignificant (P>0.05). Those Currency Fluctuations Influence (low) Stock Market Performance it means there is no impact of changes in currency value performance of stock Market. In my results of the study Currency Fluctuations Influence (high, low) Stock Market Performance it means there is no impact of changes in currency value performance of stock Market. Study on Impact of Rupee Devaluation in Indian Stock Market

References Bhatia. B M. 1974. India's Deepening Economic Crisis. S Chand & Co Private limited. New Delhi bhole, L M, 1985, Impacts of Monetary Policy. Himalaya Publishing I louse. New Delhi. Roy. Subroto and William E James (ed), 1992. Foundations of India's Political Economy. Sage Publications, New Delhi. Gupta. Suraj B. 2001. Monetary Economics: Institutions. Theory and Policy. S Chand & Company Limited. New Delhi. Uma Kapila (ed). 2001. Indian Economy Since Independence. Edited by. Academic Foundation, Delhi. Joshi. Vijay and IMD Little, 1998, India's Economic Reforms: 1991-2001. Oxford University Press, Delhi. Ranga rajan, C, 1998, Indian Economy: Essays on Money and Finance, UBS Publishers' Distributors Limited, New Delhi. Taneja, S K, 1976, India and International Monetary Management, Sterling Publishers Private Limited, New Delhi.