Corruption perception index, the ease of doing business and stock market index: moderating effect of Hofstede’ cultural dimensions

Purpose This paper examines the causal relationship between stock market performance and foreign exchange market in Egypt over the period 2009–2016. The study period is divided into two sub-periods: pre- and post-January 25th Egyptian revolution (ER). The reason is to examine how this revolution affects the causal relationship between the two markets' performance. Design/methodology/approach In this study, the daily basis data are used to enable good and effective observation changes in the foreign exchange rate and stock market performance over time. Stock market indexes and stock market capitalization are used as proxies for stock market performance. Further, the Egyptian pound to US$ exchange rate is used as a measure for foreign exchange market performance. The study analysis is done in stages. The first is to check the variables' stationarity for the pre- and post-revaluation. The second is to examine the cointegration among the variables. The third is to run vector autoregression (VAR) estimates, after which VAR Granger causality tests are employed. Findings The results show that the data are not stationary at their levels but stationary in their first difference level while there is no cointegration in the long-run among the variables in both sub-periods. Further, findings indicate that, in the pre-January 25th revolution period, there is a significant causal relationship between the foreign exchange market and stock market indexes and a significant causal relationship between market capitalization (CAP) and exchange rate at the 1% level. However, in the post-January 25th revolution period, the study does not find a significant causal relationship between foreign exchange market and stock market indexes and capitalization. Research limitations/implications As this study focuses on the causal relationship between foreign exchange and stock markets before and after the 25th January Revolution, other macroeconomic variables such as consumer price index, interest rate and GDP were excluded for the comparison purposes with other studies. Further research is suggested to include them in the analysis to find out its effect on the performance of stock market and foreign exchange market. Practical implications The existence of long-run bidirectional causality means that portfolio managers and hedgers may have improved their understanding regarding the dynamic relationship between foreign exchange market and stock market performance as this may help them to plan and implement suitable hedging strategies to guard against currency risk in future crises or events. Investors, fund and portfolio managers and policymakers should give much attention to these event-specific interactions when they make capital budgeting decisions and implement regulation policies. Furthermore, our results may allow portfolio managers, investors and policymakers to assess the importance of informational efficiency for both markets. Originality/value This paper is an original contribution to the literature that concerns the causal relationship between stock market and foreign exchange market in the period of political instability and social unrest such as the January 25th Revolution in one of the emerging markets, namely Egypt.

The main objective of this study is to reveal how stock market is affected by the macroeconomic forces. In the era of continues development and growth of stock market as well as dynamic economic prospects, it is imperative to consider this theme. Numerous macroeconomic aspects are influencing and delectating the stock market in developing countries like India. The investors are getting signal from several forces while taking investment decisions regarding higher or lower return and one aspect among them is macroeconomic panorama. Consequently, macroeconomic concern be susceptible to disturb stock market progresses. In this paper an attempt is made to derive the impact of five macroeconomic variables namely; ER (Exchange Rate), IR (Interest Rate), IF (Inflation Rate), GP (Gold Price), COP (Crude Oil Price) on performance of stock market in India. In this study 10 years yearly data from 2010 to 2019 has been used. This study includes both descriptive as well as inferential statistics like Correlation and OLS regression to find out the association and significant impact of macroeconomic variables on stock market in India. It is found that only the Exchange rate among the variables put significant impact on stock market as well as highly correlated with stock market whereas Interest rate is positively, Inflation rate and Crude Oil are negatively Correlated but all three are putting insignificant impact. In case of Gold price, the correlation result is positive but regression result is statistically insignificant during the period of study. As the interest rate and inflation rate are negatively affecting the stock market government should strategically formulate fiscal and monetary policy for betterment of the investors.

The COVID-19 epidemic has brought attention to the vulnerability of new illnesses, and immunization remains a viable option for resuming normal life. This paper examines the influence of COVID-19 vaccination on the death rate and the performance of stock market in India. For this study, COVID-19 vaccination and death rate data is gathered from the Ministry of Health and Family Welfare (MoHFW) portal, and the data for the stock index is taken from the Bombay Stock Exchange (BSE), India. In order to achieve a precise representation of feature significance and distribution, EDA (Exploratory Data Analysis) is utilized in this study. The impact of COVID-19 immunization on the mortality rate and stock market index is investigated using both statistical analysis and Machine Learning Regression-based models. The models are remarkably accurate in reproducing actual result. The empirical study suggests that vaccination has a strong positive impact on the stock market and reducing the death rate. Furthermore, the policies recommended by government and monetary authorities coupled with COVID-19 vaccine supported the stock market recovery in pandemic.

PurposeThis research aims to examine the macro determinants that significantly affect financial development in the Middle East and North Africa (MENA) region, which could be used furtherly to play a major role in economic sustainability since one of the major driving forces for economic development is the financial development.Design/methodology/approachThe significant determinants of financial development should be efficiently used by the MENA region countries for creating huge financial sector development and innovation, stimulating economic development in turn and leading to the completion of the cycle of development and sustainability. To achieve this study's objective, the researcher employed a quantitative method to develop an econometric model.FindingsThis model consisted of two Panel EGLS Cross-Section Random Effects Models (REMs) in which Domestic credit to the private sector as a percentage of GDP (?PCGDP?_it) and stock market capitalization ratio (?SMC?_it) were taken as the dependent variables. In addition, the independent variables included the corruption perception index, financial freedom (FF), political stability (PS) and trade openness (TO). The researcher extracted the data for the analysis from different databases including the World Bank, the Organization for Economic Cooperation and Development and the International Monetary Fund. Throughout the first – Panel EGLS Cross-Section Random Effects Model, it turned out that, while FF, TO and corruption index had a positive relationship with ?PCGDP?_it, PS had an adverse effect on ?PCGDP?_it. The second – Panel EGLS Cross-Section Random Effects Model showed that, while PS and TO had a positive effect on stock market performance, the corruption index and FF had an adverse effect on stock market performance.Originality/valueThroughout the first – Panel EGLS Cross-Section Random Effects Model, it turned out that, while FF, TO and corruption index had a positive relationship with ?PCGDP?_it, PS had an adverse effect on ?PCGDP?_it. The second – Panel EGLS Cross-Section Random Effects Model showed that, while PS and TO had a positive effect on stock market performance, the corruption index and FF had an adverse effect on stock market performance.

The Indian Initial Public Offering (IPO) market has evolved as one of the most dynamic and rapidly growing segments of the global capital market. Over the past two decades, Indian IPOs have demonstrated significant evolution in terms of volume, valuation patterns, investor participation, and regulatory frameworks. However, the success of an IPO cannot be guaranteed, and several factors can impact its performance in the stock market. This study seeks to explore the factors that can affect IPO performance from an analytical perspective. This report provides a comprehensive analysis of the Indian IPO market, examining key performance metrics, pricing mechanisms, investor behaviour, sectoral dynamics, and long-term sustainability of public offerings in the Indian capital market. The report synthesizes findings from multiple empirical studies conducted between 2012 and 2025, offering insights that are relevant for investors, issuers, policymakers, and financial market participants.

PurposeLiterature indicates that global geographic diversification (GD) has mixed effects on a multinational corporation’s (MNC) performances. The purpose of this paper is to examine how an MNC’s GD influences its stock market and financial performances directly and indirectly via operational performance (i.e. changes in inventory levels).Design/methodology/approachUsing firm-level data collected from Compustat database for the period 2000-2011 and estimating a mediating regression model, the authors examine the direct and indirect effects of GD on an MNC’s stock market (Tobin’s q) and financial performances (ROA), with inventory level being a mediator. Additionally, the examination is implemented separately under two economic situations: financial crisis vs without financial crisis.FindingsThe results show that GD enhances an MNC’s stock market performance, while deteriorating its financial performance in the presence of a financial crisis. In contrast, GD has little direct impact on an MNC’s stock market and financial performances during periods without financial crisis. The indirect effects of GD are mediated by changes in inventory levels.Practical implicationsThis study suggests that MNCs need to carefully weigh the benefits and costs of global strategy obtained through GD. The results also indicate that GD is highly appreciated by the stock market investors during economic downturns and tighter inventory management may further enhance firm values.Originality/valueThis paper is the first empirical research to estimate both direct and indirect effects of GD via inventory in the operations management literature, highlighting the value of GD depending on the different economic situations and echoing the role of operations in implementing GD.

The Sensex 30 is a benchmark index for India's largest companies, indicating the health of the stock market. Its movements are influenced by domestic economic conditions, corporate performance, and global trends. The INR/USD exchange rate, which represents the Indian rupee vs. the US dollar, is crucial for India's international trade and investment. A depreciating rupee benefits export-oriented companies but increases import costs, affecting market performance. Understanding this dynamic is essential for investors and policymakers. The fluctuating link between the INR/USD currency pair and SENSEX 30 stock index is examined in this study from 2014 to 2024, with an emphasis on how changes in the exchange rate affect stock market performance. As India continues to integrate into the global economy, the interaction between foreign investments and the Indian stock market has become increasingly relevant for understanding investor sentiment and economic stability. This study particularly examines how returns from the SENSEX 30, an index that monitors 30 of India's biggest and most traded firms, are impacted by changes in the INR/USD exchange rate. The research's main finding is that there is a strong positive correlation between the INR/USD exchange rate and the SENSEX 30 index, with a rise of 1 in the SENSEX 30 for every 0.90 increase in the exchange rate. This implies that the depreciation of the Indian currency (INR) in relation to the US Dollar (USD) may result in increased stock market returns, especially in industries that rely heavily on exports, as Indian goods become more competitive in international markets due to the weaker currency. On the other hand, persistent depreciation may also result in higher import prices and inflationary pressures, which might be detrimental to business profitability and the state of the economy as a whole. Given that currency changes may have an impact on their investment decisions, foreign institutional investors (FIIs) are essential to this dynamic.. Decreased international gains are eroded by a lower INR, which frequently leads to portfolio modifications and more market volatility. Exchange rate fluctuations and stock market performance are influenced by the participation of foreign institutional investors (FIIs) and the Reserve Bank of India's (RBI) monetary policy choices. For example, the RBI's changes to interest rates have an effect on investor mood and influence market movements. Global economic variables that affect the US stock market and exchange rate include geopolitical tensions, changes in the price of commodities, particularly oil, and US Federal Reserve policies. The study uses a variety of statistical techniques, including as trend analysis, a t-test, and correlation analysis, to assess the link between the performance of the SENSEX 30 and the INR/USD exchange rate during a ten-year period. The results of the t-test demonstrate that the difference between the mean values of the SENSEX 30 and the INR/USD exchange rate is statistically significant, with a t-statistic of 30.278 and very tiny p-values. The SENSEX 30 exhibits a significantly bigger variation than the INR/USD, suggesting that the stock market is more volatile than the currency rate. This result is in line with predictions because stock markets are often more erratic than exchange rates. As a result, the study emphasizes how much exchange rate fluctuations affect the Indian stock market. It is recommended that investors keep a careful eye on currency changes since they have the International Journal of Scientific Research in Engineering and Management (IJSREM) Volume: 08 Issue: 09 | Sept - 2024 SJIF Rating: 8.448 ISSN: 2582-3930 © 2024, IJSREM | www.ijsrem.com DOI: 10.55041/IJSREM37610 | Page 2 potential to impact business profitability and stock market performance, particularly in industries that depend on imports or exports. The results also emphasize how crucial it is to diversify portfolios and hedge against risk related to currencies in order to successfully manage the intricate relationships between monetary policy, market volatility, and global economic situations.

The major research question in this paper is whether improved corporate political disclosure and accountability lead to improved stock market and financial performance. To explore this question, the paper first examines the corporate financial performance of companies ranked by the Center for Political Accountability (CPA), and finds no significant relationship between a company’s ranking on the CPA and its financial and stock market performance. The paper hypothesizes that the reason for the lack of a relationship is because the CPA ranking system is itself flawed, insofar as the criteria used to evaluate corporate political accountability exclude important elements of political activity and potential corruption. To test this hypothesis, the paper adds revised criteria that include important aspects of corporate political activities and accountability. Using these revised criteria, the authors then re-evaluate and re-rank the 196 corporations in the top two quintiles of the S&P 500. The results show that, so long as appropriate criteria are used to measure corporate political disclosure and accountability practices, there is indeed a positive relationship between corporate political disclosure and accountability practices and improved financial and stock market performance.

The research paper investigates the impact of selected macroeconomic factors on the Indian stock market performance. Using a comprehensive dataset spanning key macroeconomic indicators and stock market performance metrics, the statistical analysis techniques to examine the relationship between macroeconomic variables and stock market movements is employed. The study focuses on understanding how changes in Foreign Portfolio Net Investments, Index of Industrial Production, Consumer Price Index and Exchange Rate can influence investor sentiment and trading behaviour in the Indian stock market. The findings of this research contribute to a deeper understanding of the dynamics between macroeconomic factors and stock market performance in India, providing valuable insights for investors, policymakers, and financial institutions. Keywords: Foreign Portfolio Net Investments (FPI), Index of Industrial Production (IIP), Consumer Price Index (CPI), Exchange Rate(ER), NIFTY, Indian Stock Market, Inflation.

This study investigates the relationship between the inflation, as measured by Consumer Price Index (CPI), and the Nepalese stock market index, exploring both short-term and long-term dynamics. Using econometric tools such as the Vector Autoregressive (VAR) model and Johansen co-integration tests, including time series data, the study examines whether inflation has a significant impact on stock market performance in Nepal. The results reveal that there is no long-term relationship between CPI and the stock market index. It suggests that inflation does not lead to a sustained equilibrium or long-run connection with stock market performance. However, a significant short-term relationship is found, where higher inflation has a weak negative impact on the stock market index, indicating that rising inflation can pressure stock prices in the immediate term. Additionally, Granger causality tests show no clear causal direction between CPI and stock market movements, suggesting that while the two variables may move together in the short run, their relationship does not follow a direct cause-and-effect pattern. The study provides valuable insights for policymakers and investors, suggesting that a comprehensive approach addressing multiple economic factors is essential for stabilizing the stock market. Further research is recommended to explore additional variables and extend the analysis over a longer period to gain a deeper understanding of these dynamics.

Most studies concentrate on the impact of only one constituent of the foreign capital influx on the stock market and economic performance, but only few studies simultaneously considered the unique impact of the duo of foreign portfolio investment (FPI) and foreign direct investment (FDI), and many of these studies were not undertaken in Nigeria.This study, therefore, assesses how foreign capital inflows (FPI and FDI) affect the stock market development in Nigeria. The foundations for the empirical study were built upon the dividend discount model, which formed the basis for the analytical framework. Going forward, the ARDL co-integration procedure was adopted to examine the long-run relationship between foreign capital and stock market performance. The results from the ARDL Bounds test suggest no evidence of a long-run equilibrium relationship between foreign capital inflows (FDI & FPI) and the stock market performance. Also, the short-run analysis indicates an insignificant relationship between FDI and stock market performance, whereas, a reversed relationship was obtained for FPI, as it exerts a positive and significant impact on stock market performance. The study recommends strengthening the institutional framework for the enlistment of multinational companies in the Nigerian stock market.

In all emerging economies, one of the most challenging issues for investors is the multifaceted inter-relationship between volatility of gold prices and stock market index. During the COVID-19 sub-periods, gold has shown a strong hedging behavior against stock market performance. The main objective of this study was to quantify the long-run relationship among multiple independent macroeconomic variables (predictors) on stock market index (response variable) using the volatilities of gold prices as a mediator factor. This study applied the descriptive statistics, correlation, t-test and OLS multiple regression Model. The specific data comprised of period 2011-2020 regarding the fluctuations in gold prices, exchange rate, interest rate, inflation rate and performance of stock market index has been utilized. The statistical outputs of models showed that exchange rate (Dollar to PKR) was positively affecting the performance of Karachi Stock Exchange (KSE)-100 Index, whereas inflation rate and interest rate were negatively affecting the overall performance of KSE100 index. The findings of this study suggested that to achieve better performance of stock market, relatively low interest rate and inflation rate contribute a significant role. However, to increase the generalization capabilities of this study the impact of mentioned macroeconomic variables in other sectors like industrial production, oil & gas and energy sectors with wider time span can be more helpful.

Based on a sample during 1985.Q4-2011.Q2 and applying the exponential GARCH model, we find that the stock market index in Mexico is positively associated with real GDP, the peso/USD exchange rate, the M3/GDP ratio and the U.S. stock market index and negatively affected by the interest rate, the ratio of the government deficit to GDP and the expected inflation rate. Hence, a stronger domestic economy, a lower interest rate, a weaker peso, more money supply as a percent of GDP, fiscal prudence, a stronger U.S. stock market and a lower inflation rate would help stock market performance in Mexico.

There has been an extensive debate on the relationship between real economy and stock market performance especially in the context of emerging markets. This article examines the causal relationships between the stock market performance and select macroeconomic variables in India, using monthly data from July 1997 to June 2011. We use factor analysis, ADF and PP Unit root tests, Regression, ARCH model, Granger causality and Johansen Co-integration test for data analysis. Impulse Response analysis has also been performed to check the response of stock market to shocks created in the real economy. We find a significant correlation among stock market indicators and macroeconomic factors. We identified three principal factors through Factor analysis viz Inflation, Interest rate and Exchange rate. The overall explanatory power of the regression model is 23.8%, 23.3% and 16.9% respectively for Sensex, Market capitalization and Market Turnover. There is uni directional causality from stock market to real economy. We find five co-integrating relationships between stock market and macro-economic variables. These results suggest that the stock prices movement is not only the result of behaviour of key macroeconomic variables but it is also one of the important reasons of movement in other macro dimension in the economy.

This research paper examines the impact of inflation on stock market returns, focusing on the Indian stock market. Utilizing a comprehensive methodological approach, we analyse the relationship between inflation and stock market performance through various quantitative techniques including trend analysis, regression analysis, histograms, growth percentage models, and descriptive statistics. The trend analysis reveals patterns and shifts in stock market returns in response to changing inflation rates. Regression analysis is employed to quantify the strength and nature of the relationship between inflation and stock market returns, providing insights into the degree to which inflationary pressures affect market performance. The findings of this study indicate a multifaceted relationship between inflation and stock market returns. While high inflation periods generally correlate with increased market volatility and lower returns, the impact varies across different sectors and economic conditions. Our analysis also includes the significance of monetary and fiscal policies in moderating the effects of inflation on the stock market. This research contributes valuable insights for investors, policymakers, and financial analysts, by having a detailed analysis of Inflation-Stock market study. The study's results can inform investment strategies and policy decisions aimed at mitigating the adverse effects of inflation on stock market performance and enhancing market resilience. The purpose of the study is to investigate he correlation, understand the investor behaviour and recommend the insights from the study.