I'm located in India, and am mostly focused on Indian stock markets, but I intend my question to apply generally. I don't think my question is India-specific, so have not tagged it as such.
I've read various descriptions of the mechanism of how the share price changes depending on the number of shares bought or sold, but the descriptions I've read are quite vague, and my understanding of this is still extremely fuzzy.
The behavior I see in practices violate my most basic expectations of how this should work. Specifically, I would expect if the proportion of deliverable shares (share purchase) was less than 50% (1/2) during a day's trading session, the share price would be lower at the end of the trading session. And conversely, if the proportion of deliverable shares was more than 50% (1/2), then the share price would be higher at the end of the trading session. But I see basically no relationship between delivery percentages and what the share price does.
Some of the descriptions I've read suggest that the behavior of the stock price is influenced by how much people are willing to pay for the share. But as far as I know, in practice people just buy and sell based on the prevailing market price. Limit orders do specify a price, but these are often quite far away from actual price, and if they are not triggered, I don't see how they would influence behavior of the stock price.
I see that someone already asked this in Quora, namely
but the first answer didn't explain anything to me, and the second answer didn't even seem to be addressing the question.
I'd greatly appreciate any clarity on this, including an actual explanation of how the stock price is determined by the buying and selling of shares, assuming such an explanation actually exists. References to detailed discussions would also be appreciated.
NOTE: I just realised that this question was in part based on a misunderstanding of the meaning of delivery percentage/volume. I thought it meant the proportion of shares that were purchased, as opposed to sold. I then realised this made no sense, and in fact delivery just means to the shares that end up with someone else, as opposed to intra-day trades. This is well described here.
I'll leave this question alone as an illustration of the dangers of asking questions about things one does not understand. Also, Bob's answer is a good description of the process of buying and selling of shares, and clearer than most.