Analyzing Dependence of Key Macroeconomic Variables on BSE Using Regression

Author:

Som Bhupender Kumar1,Goel Himanshu1ORCID

Affiliation:

1. Jagan Institute of Management Studies, India

Abstract

This paper aims to analyze the dependence of key macroeconomic variables on Bombay Stock Exchange (BSE) Sensex using regression modelling technique in RStudio. Monthly data points spanning a period from 2012 to 2019 has been used for the empirical investigation. The results of the model indicate that long-term interest rate (LTINT), consumer price index (CPI), and Morgan Stanley Capital International (MSCI) are found to be significant while index of industrial production (IIP) and foreign exchange (FX) are insignificant. Also, the value or r-square indicates that 93% of the variation in the dependent variable is explained by the selected independent variables. Also, the dataset was checked for normality and linearity using appropriate graphs. The results of this paper will be of immense use for the investors in predicting the stock price movement.

Publisher

IGI Global

Subject

General Medicine

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