Impact of Macro-Economic Variables on Stock Prices in India

Global Journal of Management and Business Research, Vol. 10, No. 7, 2010

18 Pages Posted: 2 May 2011

See all articles by Gagan Deep Sharma

Gagan Deep Sharma

Guru Gobind Singh Indraprastha (GGSIP) University

Mandeep Mahendru

Gian Jyoti Institute of Management & Technology

Date Written: August 1, 2010

Abstract

The paper analyzes long term relationship between BSE and macroeconomic variables, vis-à-vis, change in exchange rate, foreign exchange reserve, inflation rate and gold price. The multiple regression equation model (Galton, 1877) in order to investigate the relationship among these factors. The period of the study is January 2008 to January 2009. Results reveal that there is high correlation between the empirical results reveal that exchange rate and gold prices highly effect the stock prices on the other hand the influence of foreign exchange reserves and Inflation on the stock price is upto limited extend only.

Keywords: macroeconomic variables, multiple regression equation model, foreign exchange reserves, inflation

Suggested Citation

Sharma, Gagan Deep and Mahendru, Mandeep, Impact of Macro-Economic Variables on Stock Prices in India (August 1, 2010). Global Journal of Management and Business Research, Vol. 10, No. 7, 2010. Available at SSRN: https://ssrn.com/abstract=1827462

Gagan Deep Sharma (Contact Author)

Guru Gobind Singh Indraprastha (GGSIP) University ( email )

Sector 16 C,
Dwarka
Delhi, Delhi 110078
India

Mandeep Mahendru

Gian Jyoti Institute of Management & Technology ( email )

Phase - II
Mohali, Punjab
India

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