How to Follow the Stock Market (3 Steps)

Visit a major financial charting portal such as Google Finance or Yahoo! Finance for real-time updates to the major stock market indexes, such as the S&P 500 and Dow Jones Industrial Average. You can also get current minute-by-minute updates on individual stocks. The Google Finance system provides other tools for following the stock market as well. It streams news events for any company you chart on the website. News items are attached to the chart so you can see how prices reacted historically. If desired, you can use Google Finance to compare an individual stock's returns to that of a major market index to see if it is outperforming the overall market over a set period of time.
Monitor the pre-market data before the stock market opens each day. This information is available from financial services outlets such as CNN Money and CNBC. The data consists of futures contract pricing. Futures are special market derivatives that are traded 24 hours. If major market-moving events occur overnight due to international stock markets, the futures will reflect this in the morning. The stock market usually opens around the same levels of the futures. Thus it is possible to see how stocks might trade even before the session begins. This is a great way to follow stock market behavior in real-time.
Study the 'Bullish Percent Index' of individual stock market sectors if you wish to follow the professional sentiment among major money managers at mutual funds and hedge funds. This index is available for many sectors as well as the overall stock market index. Traders who incorporate sentiment readings into their strategies often follow the stock market in this way. It is an innovate approach to reading the minds of the biggest movers in the stock market. When sentiment is very high, the bullish percent may read 90 percent or above. This means that most of the major players in the stock market feel optimistic about market activity. 'Contrarian' traders treat such extremes in sentiment as a warning. If nearly everyone is optimistic, then is no one left to convince. This means that new buying energy may not enter the market and, contrary to the sentiment, prices might start to fall.

How to Read the Wall Street Journal Stock Report

Check the indexes. The beginning of the market report tells the movement of the major indexes such as the Dow Jones Industrials or NASDAQ.
Understand why the indexes are important. When checking out your stock you should know what size the company is, and what market it is sold in. The DOW is primarily larger companies compared to the Russell that is smaller companies. You can tell whether your stock is going up and down with market movement or whether it is moving due to a change specific to the company by knowing what index to follow.
Find the symbol for the stock. Beside it will be the opening price for the day. There is also a listing for the high of the day, sometimes the high was held for only one purchase and can be deceptive; the low, and finally the close of the day price.
Check for the change in cost for the day, followed by the per cent change. If your stock was $1a share when the market opened and it was $1.06 when the market closed; then it went up 6 cents. The percentage growth would be 6 oer cent.
Find the volume of trading. This number tells how active the stock is. The larger the number, the more actively traded. If a stock is seldom traded, and you own it and want to sell, it may be harder to sell it for the market price. Next to the volume is 52 week high and low. This is the highest reported price for the stock and the lowest in a 52 week period.
Realize that the next two columns are important in understanding what return you're actually getting. The first shows any dividends that are received from the stock and the second shows the per cent of return that it is. The dividend is a distribution of profit from the company and should be considered in the return besides using the capital gain or loss.
Understand that the PE is a ratio of the price of the stock to its earnings. The final column shows what per cent the stock has gained over the last year.

How to Calculate Stock Index Futures

View the futures contract specifications for the market you wish to trade. You can find this information online or through your broker. Each futures contract represents a set quantity of the underlying instrument it tracks. In the case of stock indexes, each futures contract relates to the price level of the index in some way. For example, one DJIA futures contract has a value equal to $10 x the price of the DJIA. You can use several sources to get index prices, including CME Group, Yahoo! Finance and TFC Charts (see Resources).
Check the current price of the index futures market. After obtaining the price, use the multiplier in the futures contract specifications to determine the value of a contract. For example, if DJIA futures are trading at 10,650, the value of one contract is 10,650 x $10 or $106,500. Note that the margin needed to buy a futures contract is much less than this full value because of the amount of leverage used in the futures markets.
Calculate potential profit and loss using the tick size. In futures trading, the tick size is the minimal increment in which price can move. In DJIA futures, the tick size is one point and each tick is worth $10. Assume that the market is trading at 10,650 and you expect a bull move to 10,690. You plan to enter a trade by purchasing two contracts. Therefore, your expected profit on the trade is 40 (points) x $10 x 2 (contracts) or $800.