What is the primary factor that affects stock prices?

The primary factor that affects stock prices is supply and demand. This fundamental economic principle explains that when there are more buyers than sellers for a stock, its price tends to rise due to increased demand. Conversely, if there are more sellers than buyers, the price typically falls due to oversupply. The interaction between buyers and sellers in the market reflects their perceptions of the stock’s value, which can lead to price fluctuations based on various internal and external influences.

Other factors, such as media coverage and market speculation, can influence investor sentiment and behavior, but they ultimately drive changes in supply and demand. For instance, positive media coverage can increase demand for a stock, causing its price to rise, while negative coverage might lead to a decrease in demand. Similarly, market speculation can lead to price changes, but it is still rooted in the dynamics of supply and demand since speculative actions often reflect traders' expectations regarding future value rather than the underlying fundamentals of the company. Company age might have some relevance in assessing stability or growth potential, but it is not a primary factor influencing stock prices compared to supply and demand.