As we all know Indian stock market is strongly influenced by the global market. After globalization, the Indian stock market is integrated into the global market and its effects are visible. There are several factors that affect the Indian stock market namely interest rate, supply, and demand, inflation and effect of the international market. Out of these effects of international market plays a very important role in regulating Indian stock market. When there is a global recession these Indian companies cannot sell their products in the international market. This affects the revenue portfolio of the company. This changes the values of shares of the company in the Indian market. People stop investing in such companies and eventually the share price falls. The share price movements of these companies are more likely to be affected by the development of the world economy. This will result in a decline in the country’s stock exchange.