The Relationship Between Stock Prices and Prices of Real Goods in the Indian Economy – An Analysis from a Historical Perspective

Subrahmanya Kumar, N and Puttanna, K (2016) The Relationship Between Stock Prices and Prices of Real Goods in the Indian Economy – An Analysis from a Historical Perspective. In: The Relationship Between Stock Prices and Prices of Real Goods in the Indian Economy - An Analysis from a Historical Perspective, 07/10/2016, Anekant Institute of Management Studies, Pune.

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Abstract

The general assumption that stock market should reflect the economic buoyancy indicated by the changes in the prices of real goods in the economy may not be true in reality. The present study aims to analyse, from historical perspective, the relationship between the agriculture and manufactured goods’ prices on one hand and stock prices on the other. This is done by analyzing the changes in Price Index of Agricultural Products and Price Index of Manufactured Products as explanatory variables, representing economic prosperity of the country, and the changes in the values of S&P BSE SENSEX as the explained variable representing the changes in stock prices by assuming a linear relationship between the two sets of variables. The results indicate that, though plausible relationship exists between the explanatory and explained variables, the relationship is not significant and the changes in S&P BSE SENSEX does not readily reflect the economic conditions prevailing in the economy.

Item Type: Conference or Workshop Item (Paper)
Uncontrolled Keywords: Stock market, regression coefficient, S&P BSE SENSEX,
Subjects: Departments at MU > Commerce
Depositing User: MIM User
Date Deposited: 24 Jun 2017 08:19
Last Modified: 27 Jun 2017 04:00
URI: http://eprints.manipal.edu/id/eprint/149157

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