THE IMPACT OF MACROECONOMIC FACTORS ON STOCK PRICES: AN EXPERIENTIAL OBSERVATION AT BANKING, FINANCE AND INSURANCE SECTOR LISTED IN HO CHI MINH STOCK EXCHANGE (HOSE) IN VIET NAM PERIOD 2010-2013

Abstract

This research was conducted to assess The impact of Macroeconomic factors on Stock Price an empirical at Banking, Finance and Insurance sector listed in Ho Chi Minh Stock exchange (HOSE) period 2010-2013.The stock market is important for economic growth because it ensures the flow of resources to most productive investment opportunities. There are some macroeconomic factors that find it important in estimating the relationship between stock market return in Vietnam. Besides, this paper intend to investigate the relationship of several macroeconomic factors such as Interest Rate, Consumer Price Index, Exchange Rate and Money Supply M2 Growth rate with Stock Price in Vietnam. The data is collected from several official website such as General Statistic Office of Vietnam, the State Bank of Vietnam,The World Bank and Asian Development Bankin the period 2010-2013 monthly. This research use Quantitative analysis method and secondary data. Data analysis technique used is multiple linear regression with least squares equation and test hypotheses using T-statistic for testing the partial regression coefficients and F-statistics to test the effect together with a significance level of 5%. It also tested the classical assumption that included tests of normality, multicollinearity test, test of heteroscedasticity and autocorrelation test. This shows the available data has seen qualified using multiple linear regression equation model. These results indicate that Interest Rate, Consumer Price Index, Exchange Rate, and Money Supply M2 Growth Rate have significantly positive effect towards the stock price in Banking, Finance and Insurance Sector listed in Hoc Chi Minh Stock Exchange (HOSE) period 2010-2013. Predictive ability of four variables to stock price in this research of 75.1% while the remaining 24.9% be affected by other factors not included in the research model.