Abstract:
Purpose- The purpose of the research is to examine the impact of economic variables on
stock market of Pakistan. The selected economic variables are interest rate, exchange rate
and consumer price index. To examine the stock market performance the following variables
are used such as KSE-100 index, Turnover, Trade volume.
Methodology/sample- The nature of the research is Quantitative. By the help of quantitative
models that are involved to examine the impact of change in economic variable that are
interest rate, exchange rate and consumer price index on stock market of Pakistan. The data
of this proposed research is collected from secondary sources and analyzed by the SPSS
software. Regression is applied to analyzed the relationship between the dependent and
independent variable.
Findings- It is found that Interest rate is significant, and have negative impact on dependent
variable (KSE-100 Index) while Exchange rate and Consumer price index are insignificant.
On dependent variables (Turnover and Trade Volume), there is no impact of independent
variables (Interest rate, Exchange rate and Consumer price index).
Practical Implications- This research study explains the impact of change in the interest
rate, exchange rate and consumer price index on stock market of Pakistan. It shows the
changes of these variables and their positive impact or negative impact on stock market. This
research provides better understanding of fluctuation of stock market and impact of these
variables on it. This research will analyze data, conclude the results and draw
recommendations based on those results that whether these variables have positive impact or
negative impact on the stock market of Pakistan.
