Even when the market in America has ceased for the day, it's still going on in other parts of the world. London. Tokyo. Singapore. Trading takes place twenty-four hours a day somewhere on earth. That's why your stock might close at 'X' when you go to sleep, but be lower when you wake up.
"Even when the market in America has ceased for the day, it's still going on in other parts of the world."
At the end of the day mutual funds have to settle out, also, buying and selling.
Then the DOW never opens at the same price it closes, yet it only reflects American prices? In fact the opening price reflects the first transactions of each component after the market opens. If it takes a minute or two for each of the 30 DOW Industrials to transact, there is no price for a minute or two.
Now, that opening transaction will surely reflect overnight trading prices.
yitbos