The impact of macroeconomic determinants on KSC-100 index
Hayat Khan, Itbar Khan, Jamil Ahmad Khan, Arif Hussain Jandan
This relationship has been found in many research studies in the world. This paper is to examine the relationship between the KSC-100 index and a set of macroeconomic variables namely interest rate, inflation rate, CPI and foreign exchange rate. For analysis purpose secondary data were used for the period of 1991 to 2009. Multiple Regressions and Pearson’s correlation model were applied to the data to find the relationship between KSE-100 index and macroeconomic variables. Model was good fit and was strong relationship between dependent and independent variables. The tests shows that there is 71% variation in the stock prices by variation in independent variables. The results also shows that the impact of independent variables inflation and CPI are positive on ksc-100 index and interest rate and foreign exchange rate are negative.