Stock and bond markets: worldwide and in Uzbekistan

In the news we often hear "the index fell 2%" or "the government placed international bonds". Behind these words stands one system: a market where companies and states raise money and investors sell securities to each other. Below, relying only on verified sources, we explain how this market is structured, the world's best-known exchanges and indices, and the situation in Uzbekistan.

Primary and secondary markets

A security's life has two stages. - Primary market: the issuer sells new shares or bonds to investors for the first time, and the money goes to the issuer. If a share is sold above face value, share premium arises in the issuer's books. - Secondary market: investors sell previously issued securities to each other. The issuer receives no money from this trading, but the price shows it how the market values it.

Secondary trading can take place on an exchange or off it. The Britannica dictionary defines a stock exchange as a system or place where shares of various companies are bought and sold.

Worldwide: how two famous exchanges began

The site has a separate history article on the first joint-stock company and the Amsterdam exchange. Two more examples: - London. According to History Today, before the exchange had its own building, brokers met and traded for about a century in the coffeehouses of Exchange Alley; the exchange's own building was put up in 1773. Britannica also dates the history of the London Stock Exchange from 1773. - New York. According to Encyclopedia.com, the roots of the New York Stock Exchange go back to the Buttonwood Agreement signed by brokers in 1792, and it took its current name in 1863.

Stock index: the market's "thermometer"

It is impossible to follow the prices of thousands of shares one by one, so an index is built: the prices of selected shares are combined into one number. Two famous examples: - Dow Jones Industrial Average: according to Britannica, it is based on the share prices of 30 industrial companies and is price-weighted (an expensive share has more influence on the index). - S&P 500: Britannica calls it a market-capitalisation-weighted index widely regarded as the chief benchmark of the US stock market (a large company has more influence).

What does this difference mean in practice? Let us look at three hypothetical companies:

The same 10% rise carries more "weight" for small but high-priced Alfa under the first method, and for large Gamma under the second. That is why different indices can move differently on the same day.

The bond market

Bonds are issued by both companies and states. A government bond is a way to borrow for the budget; it can be placed in the national or a foreign currency, on the domestic or the international market. Government bonds placed on the international market are often called "sovereign international bonds" or "Eurobonds".

In Uzbekistan: who is on the market?

Exchange. The Republican Stock Exchange «Toshkent» operates in the country for trading shares and corporate bonds (official website uzse.uz).

Regulator. It was reported that in September 2023, by a resolution of the President, powers to regulate the capital market were given to the National Agency for Perspective Projects (Kun.uz, 4 September 2023). The agency's official website napp.uz publishes a register of participants of the "regulatory sandbox" special regime in the capital market.

The state's international bonds. Uzbekistan placed sovereign bonds on the international market for the first time in February 2019 (Bloomberg, 13 February 2019). In October 2023 the United Nations Development Programme reported that Uzbekistan had for the first time placed "green" sovereign international bonds in national currency (soums). And in April 2026 the Ministry of Economy and Finance announced that sovereign international bonds in national currency had been placed at a historically low interest rate. Read the amounts and rates in the official announcements themselves: they differ with each placement.

Tax rules. Under Article 304, item 19, of the Tax Code, income on government bonds and other government securities of Uzbekistan, as well as on international bonds issued by Uzbekistan and its legal entities, is not counted as income for tax purposes. Article 483, part 27, from 1 April 2022 to 31 December 2028 exempts individuals' dividends on shares from personal income tax, and interest on bonds of business companies from personal income tax and corporate profit tax; a 5% corporate profit tax rate applies to dividends on shares of non-resident legal entities. More details are in the articles on dividends and bonds.

Useful habits when watching the market

1. Compare price and index changes with the issuer's financial statements: the price shows the mood, the statements show the real result.
2. Spreading money across several companies rather than one reduces risk (diversification).
3. For a bond, check not only the coupon but also the issuer's ability to pay and the term.
4. Take statistics and rates only from the official websites of the exchange, the regulator and the ministry, with a date.

Important note: this article is written for educational purposes and is not a recommendation to buy or sell any securities.