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The Correlation Between Economic Indicators And Taiwan Stock Market €“ A Case Study Of Leading And Lagging Indicators

Author

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  • YANG, Tzu-Yi

    (Department of Business and Management, Ming Chi University of Technology, Taiwan.)

Abstract

This study investigates the correlation between economic indicators and Taiwan stock market, analysing the leading and lagging indicators from January 1995 to December 2016 to determine whether there is any significant correlation between the indicators and the stock market. With Large-cap Stock Price Index as dependent variable and the leading and lagging indicators as independent variables, and the correlation between the leading and lagging indicators and Taiwan Stock Exchange Corporation (TSEC) Large-cap are empirically analysed by multiple regression analysis in Eviews 9. It is concluded that there is both a significant and positive correlation between the leading indicator of the Index of Export Orders and the closing price of TSEC Large-cap Stocks and a significant and negative correlation between the lagging indicators of Unemployment Rate and Inventories to Sales Ratio for Manufacturing and TSEC stock price.

Suggested Citation

  • YANG, Tzu-Yi, 2020. "The Correlation Between Economic Indicators And Taiwan Stock Market €“ A Case Study Of Leading And Lagging Indicators," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 24(4), pages 41-59, December.
    • Handle: RePEc:vls:finstu:v:24:y:2020:i:4:p:41-59
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    References listed on IDEAS

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    1. LUPU, Iulia, 2018. "Analysis Of How The European Stock Markets Perceive The Dynamics Of Macroeconomic Indicators Through The Sentiment Index And The Purchasing Managers' Index," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 22(1), pages 32-52.
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      More about this item

      Keywords

      TSEC Large-cap Index; leading indicators; lagging indicators;
      All these keywords.

      JEL classification:

      • D53 - Microeconomics - - General Equilibrium and Disequilibrium - - - Financial Markets
      • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
      • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)

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