Research on the Relationship Between Macroeconomic Indicators and Stock Market Value

Abstract

The article first addresses the following questions: “Why does gross domestic product (GDP) rises, but the stock market value falls?”; “Among the macroeconomic factors, which factor has a greater impact on the promotion of investment value in the securities market?”. With these questions in mind, we put forward a hypothesis emphasizing on the impact of macroeconomic factors on the value of the stock market based on existing research and used the regression method to verify this hypothesis. The following conclusions were drawn: (1) variables that have a positive nonlinear relationship with stock market value include balance of payments surplus, rising GDP level, M1, the whole society’s fixed asset investment, and national per capita disposable income; (2) variables that have a negative nonlinear relationship with stock market value include deposit, loan interest rate, new RMB loan amount, consumer price index (CPI), and producer price index; (3) deposit reserve ratio has an S-shaped curve relationship with stock market value; (4) exchange rate has an inverted U-shaped curve relationship with stock market value.