The market is split into a number of sectors. A sector is a group of companies within the same industry such as Energy, Media or Banks. Economic conditions will effect companies in different ways. For example, a weakening currency makes that country's resources more affordable on the international markets, thus increasing the turnover of these companies. Instead of looking at the market as a whole, looking at strong performing sectors for strong performing stocks is a more successful trading strategy.

Each sector has an index. This is a weighted sum of the share prices in each sector. Every exchange has a primary market index and this is the benchmark for how the market is performing from day to day.