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Macroeconomic Variables In China

From the beginning of the first public company on the Shanghai Stock Exchange in 1990,the stock market has experienced a rapidly increase during these twenty years in china.Up to the year of 2008, there were approximately 1650 public companies on either Shanghai Stock Exchange or Shengzheng Stock Exchange with the total market capitalization of 121366(100 million yuan).The relationship between macroeconomic variables and market prices has been widely recognised by economists,they have made a lot of researches in this field,though the way to identify their bearings are vary from person to person.Some of them use only one of macroeconomic variables like Comoncioli(1995)who focuses on the relationship between stock market index and Gross Domestic Product (GDP),Pearce and Roley(1983) study on the PPI(producer price index),and Lee (1992)emphasizes on the Interest Rate.Some prefer to combine different kinds of macroeconomic variables for analysize.Abdullah and Hayworth(1993)use seven macroeconomic variables (namely,money spply,inflation ,short and long-term interest rates,budget,trade and the growth of industry)to study their relationship between stock market prices.Tursoy,Gunsel and Rjoub(2008) adopt more than ten macroeconomic variables for research.In this mini essay, the first part is the introduction of some relative backdrop,including the situation of stock market in china and the privious researches of other learners.Next to this,it begins to analyse the relationship between each macroeconomic variables and stock market prices according to the detailed statistics in china.The last part is to draw some conclusions.
Since the differennt research purposes,the selection of proper and relevant macroeconomic variales are different.Dritsaki(2005)thinks that selecting macroeconomic variables should focus on those objects which reflect both economic and financial situation of one country. Thus,variables like GDP,CPI , Money Suppley, Exchange Rate,Interest Rate are applyed in this essay, for there are more likely valuable in tracing the relationship betwwen macroeconomic variables and stock market prices based on the special situation in china.
On the long run,the fluctation of stock market prices and the changement of GDP shows a positive relationship,except the year of 2007.As we are known,GDP is a kind of mixed index ,which reflects the strength of a country’s overall macro-economic indicators. When there is a decline in the economic downturn, the majority of the public companies are more likely to reduce their investment and costs ,hence, the stock market’s supply will move slowly;at the same time,due to economic downturn and lower expection and future income, investors, thereby reducing capital expenditure and investment,.Consequentaly,stock prices is bound to fall down. Conversely, when a country’ GDP grews rapidly, the herald of economic prospects, expectations about the future improvement of business confidence in future development, are keen to enlarge the scale of additional investment and the demand for capital expansion, thus stimulate the stock market and increase its whole value.
Consumer Price Index

Economic Impacts of transnational corporations on industrialised countries

Identify and comment on the economic and environmental impacts of transnational corporations on newly industrialized countries you have studied.
Introduction The object of this report is to assess the economic

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