DISCUSSION, CONCLUSION AND IMPLICATIONS
5.6 Conclusion
The macroeconomic model is examined to see whether macroeconomic factors can explain the performance of stock market returns in emerging nations. The macroeconomic variables used in this study include Consumer Price Index (CPI), exchange rate (ER), Gross Domestic Product (GDP), interest rate (IR) and money supply (M1). The stock markets used in this paper are FTSE Bursa Malaysia (KLSE), The Stock Exchange of Thailand (SET), Indonesia Stock Exchange (Bursa Efek Indonesia, IDX) and The Philippine Stock Exchange (PSE).
The result of FTSE Bursa Malaysia (KLSE) shows that there is positive relationship between interest rate (IR) and money supply (M1) towards FTSE Bursa Malaysia (KLSE). However, Consumer Prices Index (CPI), exchange rate (ER) and Gross Domestic Product (GDP) have negative relationship with FTSE Bursa Malaysia (KLSE).
The result of The Stock Exchange of Thailand (SET) shows that there is positive relationship between money supply (M1) towards The Stock Exchange of Thailand (SET). On the other hand, Consumer Prices Index (CPI) shows negative relationship with The Stock Exchange of Thailand (SET). However, exchange rate (ER), Gross Domestic Product (GDP) and interest rate (IR) do not have significant relationship with The Stock Exchange of Thailand (SET).
The result of Indonesia Stock Exchange (Bursa Efek Indonesia, IDX) shows that there is negative relationship between exchange rate (ER) and interest rate (IR)
towards Indonesia Stock Exchange (Bursa Efek Indonesia, IDX). However, Consumer Price Index (CPI), Gross Domestic Product (GDP) and money supply (M1) do not have significant relationship with Indonesia Stock Exchange (Bursa Efek Indonesia, IDX).
The result of The Philippine Stock Exchange (PSE) shows that there is positive relationship between Gross Domestic Product (GDP) towards The Philippine Stock Exchange (PSE). On the other hand, Consumer Prices Index (CPI) and exchange rate (ER) have negative relationship with The Philippine Stock Exchange (PSE).
However, interest rate (IR) and money supply (M1) do not have significant relationship with The Philippine Stock Exchange (PSE).
As a conclusion, this paper has achieved the main objective of investigating the significant relationship between Consumer Price Index (CPI), exchange rate (ER), Gross Domestic Product (GDP), interest rate (IR) and money supply (M1) towards stock market returns of FTSE Bursa Malaysia (KLSE), The Stock Exchange of Thailand (SET), Indonesia Stock Exchange (Bursa Efek Indonesia, IDX) and The Philippine Stock Exchange (PSE).
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