The Macroeconomic Determinants of the Stock Market Index Performance: The Case of DAX Index
Purpose: This research will try to show that macroeconomic conditions are basically the main determinants of stock market performance and for this reason DAX Index will be analyzed. Design/Methodology/Approach: In particular, the macroeconomic factors that affect the performance of DAX will be used. The methodology to be followed is linear regression and in particular Ordinary Least Squares (OLS). Findings: The performance of a stock exchange is affected by the constantly continuous international political and economic conditions that have a strong influence on the operation of stock exchanges around the world. States remain the main actors in the international economy and this means that macroeconomic data act as catalysts for stock market performance. Practical Implications: Stock exchange is actually the “mirror” of an economy. There is much literature that has dealt with the determinants of stock market performance around the world. Today's era is highly globalized. The current era has made it clear that there are many parameters that are exogenous and have a serious impact on the economy and therefore on the performance of the stock market. Originality/Value: Since the economy is the field in which every stock market operates, it should be borne in mind that macroeconomic factors are of great importance.