stock price reaction

Stock price reaction refers to how a company's share price changes in response to new information, such as earnings reports, economic data, or news events. When positive news emerges, investors often buy more shares, driving the price up. Conversely, negative news can lead to selling, causing the price to fall. These movements reflect investors’ collective expectations about the company's future performance. The stock price acts as a real-time gauge of market sentiment, balancing supply and demand based on perceived value and risk. Short-term fluctuations are normal, but they often respond swiftly to significant developments.