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Research Paper | Management | India | Volume 12 Issue 3, March 2023 | Popularity: 5.1 / 10

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A Study on Performance of Nifty 50 in Relation to Macro Economic Variables

Dr. Swati Modi, Maitrey Bhagat

Abstract: The stock market plays a pivotal role in mobilizing the savings, financing the requirement of the corporate, providing liquidity to the corporate sector and to the investors. Liquidity in the market improves the distribution of resources and aids in the economic growth and development of the country. In turn, various economic variables also affect the stock market. Indian capital markets have been receiving global attention and the rapid integration with the world economy has increased India?s global competitiveness. The global ratings are awarding India with investment grade ratings, indicating comparatively lower sovereign risks. The Securities and Exchange Board of India (SEBI), the regulatory authority for Indian securities market, was established in 1992 to protect investors. In the same year, Controller of Capital Issues (CCI) was abolished, which removed administrative controls over the pricing of new equity issues. In less than a decade later, the Indian financial markets acknowledged the use of technology (National Stock Exchange started online trading in 2000), which increased the trading volumes by many folds. There is a sharp surge and rapid growth in the stock markets. This paper would study if there is any impact of Macro economic factors like FDI, GDP, Money supply, structure of interest rates, Inflation, gross capital formation, trade balance on Sensex. The tools to study this objective would be descriptive statistics, OLS multiple linear regression model.

Keywords: Sensex, GDP, inflation, gross capital formation, FDI

Edition: Volume 12 Issue 3, March 2023

Pages: 262 - 265

DOI: https://www.doi.org/10.21275/SR23306153456

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