Stocks go up and down because of supply and demand. Prices go up when there are more buyers than sellers. And prices go down when there are more sellers than buyers.
So what causes the changes in supply and demand?
Here are a few examples of reasons why a stock can go up in the short-term:
- Companies profits beat expectations
- Generally positive and optimistic market outlook
- New confidence-inducing CEO
- Rumours or expectations of a merger or acquisition.
- Announcement of dividends
- Introduction of a new product