In which market does a transaction occur when a syndicate of investment banks purchases a common stock issue from a corporation?

The transaction occurs in the primary capital market when a syndicate of investment banks purchases a common stock issue from a corporation. This market is where new securities are created and sold to investors for the first time. In this scenario, the investment banks are facilitating the initial sale of stock directly from the corporation to the public. By underwriting the common stock issue, the syndicate essentially helps the corporation raise capital, which is a primary function of the primary market.

In contrast, the secondary capital market is where previously issued securities are traded among investors, not involving the issuing corporation directly. The derivatives market is focused on financial instruments whose value is derived from other underlying assets, while the money market primarily deals with short-term debt instruments and is not involved in equity transactions. Thus, the primary capital market is the accurate context for this transaction.