Stock Markets

[ck1]

At the end of each day the FTSE is reported as being so many points up or down, what has actually happened to cause this variation? Same with currency, how does the value of a pound actually change against that of a euro / dollar etc, what actually happened for the value to change?

[Captain Spod]

The FTSE is a summary of the prices of a group of shares. The values of the shares change because of supply and demand. If I hold shares that lots of people want I can charge more when I sell them; If nobody wants them I will have to reduce my asking price. It is similar with currencies. If an American wants to buy pounds I will sell them to him for as many dollars as I can get. If he is reluctant to buy then I will have to accept fewer dollars. There is, of course a lot more to it than this: economic theory, projections, etc. but that's the outline. Hope it's clear.
CS