Title: The macroeconomic determinants of the stock market index performance: the case of DAX index
Authors: Emmanouil Karakostas
Addresses: Department of Economics, School of Economics, Business and International Studies, University of Piraeus, Greece
Abstract: The stock exchange is the 'mirror' of an economy. There is much literature that has dealt with the determinants of stock market performance around the world. The current era has made it clear that many parameters are exogenous and have a serious impact on the economy and the performance of the stock market. 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. States remain the main actors in the international economy, meaning that macroeconomic data act as catalysts for stock market performance. However, the question that arises is the following: Which macroeconomic factors have a greater impact on the performance of the stock market: trade, production, or monetary aggregates? From the present study's analysis, the monetary aggregates are the most important, following trade and lastly industrial production. The methodology to be followed is Bayesian model averaging.
Keywords: DAX index; Bayesian model averaging; Germany.
DOI: 10.1504/IJFMD.2023.139142
International Journal of Financial Markets and Derivatives, 2023 Vol.9 No.4, pp.298 - 309
Received: 03 Sep 2023
Accepted: 14 Apr 2024
Published online: 14 Jun 2024 *