Impact Factor: 5.2 IJAR

Iftaqar Research, Jyotsna Sinha, Iftaqar Ahmad, Jyotsna Sinha
2016 unpublished
Predicting movements in the Bombay Stock Exchange (BSE) is perhaps one of the hardest exercises in financial studies as it has many variables affecting its movement. In this paper I have taken two macro variables i.e. Gross Domestic Product & Exchange Rate and collected 12 months secondary data for the year 2014 from the website of RBI and Sebi. The data collected has been analyzed by using spss through correlation, regression and ANOVA in order to draw meaningful information. The findings show
more » ... that GDP is the significant predictor and Exchange Rate is not the significant predictor of BSE Sensex. Introduction A stock market or stock exchange is a market where securities are bought and sold. In this market the shares of public as well as private companies are traded thorough exchanges or the OTC (over the counter) markets. It is one of the oldest stock market in Asia. Its origin dates back to 18 th century when East India Company use to transact loan securities. Since the year 1991, when the government adopted LPG (liberalization, privatization and globalization), stock market of India has undergone tremendous change. The Indian Economy grew at an alarming pace after the adoption of LPG. That is why the stock market of India plays a very important role for aggregate economy. The capital market of India is one of the emerging markets in the world. That is why investors in India and abroad have keen interest for investment purpose in the Indian stock market. There is the need of the hour to study and understand the key variables that influences the shareholders wealth. The Securities and Exchange Board of India (SEBI) is the regulator for the securities market in India. It was established in the year 1988. SEBI has enjoyed success as a regulator by implementing reforms as and when needed. It introduced rolling cycle of T+2 which means settlement is done in 2 days after Trade date. Sebi has been active in setting up the regulations as required under law.