Spock (rhp)
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simple
after the market closes, the company announces some major news. The next morning, the shares open quite a distance from where they closed the previous night. This is called a "gap" [technically, it is only a gap if it is outsdie the prior day's high to low range].
Rarely, a data error is found after the 'closing' price is published and adjested before the next day's open.
And, for stocks that trade in markets in other time zones, there will be action while your local markets are closed and when they do open, the first order of business will be for the price to move toward that in the other market.
oh |
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Hibee
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Same way the price of a pint of milk can change overnight when the supermarket is closed.
Think of the stockbrokers as a supermarket. They hold the stock and control the price. |
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jory
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Markets are never actually closed, they are on a continual cycle around the world. |
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Hey it's Ken!
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Also, stock prices are just an agreed upon price between two parties. Therefore, if there is news overnight affecting the company, industry, or economy in general, the price where two people might agree will definitely change. |
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jeff410
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There is some trading that is done when the market is closed. And orders can be placed when the market is closed. A backlog is created and a clearing process takes place by the market makers and specialists so that an opening price is established. |
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graciouswolfe
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The entire world is involved in the stock market, not just the USA. |
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firebobby
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Stock markets around the world operate at different times. Their influence can alter prices in markets that are closed. |
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Chuck P
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It's due to after market trading, you can buy stocks before and after the market closes. It usually isn't a good idea because the costs are higher but some die hards still do it. |
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Ollie
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Thanks to the Internet. |
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Common Sense
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Some of the answers you've gotten are good. Some are bad, such as;
Think of the stockbrokers as a supermarket. They hold the stock and control the price. - WRONG!
The price of a stock is controlled 99.9% of the time by the buyers and sellers of stock. Every time there's a trade between a buyer and a seller is the price at that moment.
Stocks trade on (among other things) perceived value. If that value has changed (on the world market, or here at home), the price will change to reflect that, at the open.
If you're buying a used car. The "buyer" has a percieved value. The seller has a percieved value. If news comes out overnight that the car model is dangerous to drive in... the "value" (perceived value) will go down.
Sometimes people are just in a hurry to sell a stock. Sometimes they're in a hurry to buy it. All of this and more effects the price.
Read some good books on investing. It will help (ALOT)! |
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