Research On The Impact Of China’s Main Economic Variables On The Stock Market

The relationbetween a country’s economy and the stock market is always animportant topic of academic researchers in economic, it is also a market topic manystock investors are closely concerned about."The stock market is the barometer of the economy," So，do China’s economicdevelopment speed and health exactly have an impact on the rise and fall of the stockmarket in recent years? And how it does? How much impact does it have?This article, basing on domestic and foreign research, makes the theoreticalanalysis of the impact of China’s economy on the stock market by economicprinciples and logic of the market.Then, select five most representative economicvariables, usingError correction model VEC, with Granger causality test, Impulseresponse, Variance decomposition methods, and do an Empirical Analysis whichwillproof how much the impact during96periods from January2006to December2013.Research results show that: The Shanghai Index of the previous period, the CPIand Industrial added value GY have a positive impact on Shanghai Index SZ in ashort term of3-6months. And In a long term more than12months, the ShanghaiIndex of the previous period, market interest rates LL and RMB exchange rate HLhave a positive effect, but money supply M2has a negative effect.Finally, it makes a number of objective and practical countermeasures at sevenaspects, laws, listing audit, continuous supervision, dividends supervision, resolutelydelisting, public reporting and protect of investor.