Title: Impact of macroeconomic factors on banking stock index: empirical evidence from Indian banking sector

Authors: Sumit Kumar Maji; Arindam Laha

Addresses: Department of Commerce, The University of Burdwan, Golapbag, Burdwan-713104, West Bengal, India ' Department of Commerce, The University of Burdwan, Golapbag, Burdwan-713104, West Bengal, India

Abstract: In the present study, an attempt was made to explore the effect of the macroeconomic variables on the banking stock prices in Indian context. To proxy the trend of the banking stock in India, banking sector specific stock index in Bombay Stock Exchange (BSE), i.e., BSE_Bankex was used. The outcome study suggested the existence of long-run association between the select macroeconomic variables and the BSE_Bankex which was arrived at by making short-run error correction at the speed of 16.12% per month. Foreign portfolio investment ratio and price factor were found to be exerting positive and significant effect on BSE_Bankex whereas the impact of economic policy uncertainty was found to be negative.

Keywords: BSE_Bankex; foreign portfolio investment ratio; price factor; economic policy uncertainty; ARDL-UECM.

DOI: 10.1504/IJICBM.2022.122726

International Journal of Indian Culture and Business Management, 2022 Vol.25 No.3, pp.347 - 377

Received: 31 May 2020
Accepted: 14 Feb 2021
Published online: 09 May 2022 *

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