Stock Market Indices Around the World
In Chapter 1, we described the major U.S. stock market in-
dices. As discussed below, similar market indices also exist
for each major world financial center. The accompanying
figure compares five of the indices against the U.S. Dow
Jones Industrial Average.
Hong Kong (^HSI)
In Hong Kong, the primary stock index is the Hang Seng.
Created by HSI Services Limited, the Hang Seng index
reflects the performance of the Hong Kong stock market. It
is composed of 33 domestic stocks that account for about
70 percent of the market’s capitalization.
Great Britain (^FTSE)
The FT-SE 100 Index (pronounced “footsie”) is the most
widely followed indicator of equity investments in Great
Britain. It is a value-weighted index composed of the 100
largest companies on the London Stock Exchange whose
value is calculated every minute of trading.
Japan (^N225)
In Japan, the principal barometer of stock performance is
the Nikkei 225 Index. The index’s value, which is calculated
every minute throughout daily trading, consists of a collec-
tion of highly liquid equity issues thought to be representa-
tive of the Japanese economy.
Chile (^IPSA)
The Santiago Stock Exchange has three main share indices:
the General Stock Price Index (IGPA), the Selective Stock
Price Index (IPSA), and the INTER-10 Index. The IPSA,
which reflects the price variations of the most active stocks,
is composed of 40 of the most actively traded stocks on the
exchange.
India (^BSESN)
Of the 22 stock exchanges in India, the Bombay Stock Ex-
change (BSE) is the largest, with more than 6,000 listed
stocks and approximately two-thirds of the country’s total
trading volume. Established in 1875, the exchange is also the
oldest in Asia. Its yardstick is the BSE Sensex, an index of 30
publicly traded Indian stocks that account for one-fifth of
the BSE’s market capitalization.
Note: For easy access to world indices, see http://finance.yahoo.com/m2
and use the “ticker” symbols shown in parentheses.
560 Multinational Financial Management
