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Original Research

MACROECONOMIC FACTORS AND STOCK MARKET PERFORMANCE IN MALAYSIA DURING THE PANDEMIC

HAU JOH EN 1, and SALAAR FAROOQ 2.

Vol 17, No 08 ( 2022 )   |  DOI: 10.5281/zenodo.6984080   |   Author Affiliation: ---   |   Licensing: CC 4.0   |   Pg no: 691-715   |   To cite: HAU JOH EN, and SALAAR FAROOQ. (2022). MACROECONOMIC FACTORS AND STOCK MARKET PERFORMANCE IN MALAYSIA DURING THE PANDEMIC. 17(08), 691–715. https://doi.org/10.5281/zenodo.6984080   |   Published on: 12-08-2022

Abstract

The stock market performance and its influence on macroeconomic stability have attracted substantial attention from academia. The pandemic had a big effect on the world economy. There needs to be more research on how the stock market did during pandemic because the results could be different. The primary objective of this study is to investigate the nature of the relationship, if any, that correlation between macroeconomic indicators and stock market performance during pandemic is seen. For this study secondary data were collected every month from 2020 to 2021. The KLCI index, which is used to gauge the overall health of the stock market, will serve as the dependent variable for this investigation. The efficiency of the economy is the independent variable, and Inflation, exchange rates, interest rates, as well as the lot of cash are used to measure volatility that is in circulation. To test the research hypotheses, the multiple linear regression frameworks is also used. Aside from that, the multiple linear regression model built for this research can predict 65.1% of the change in the KLCI index based on how certain macroeconomic factors interact. In the end, USD/MYR exchange rate made the stock market in Malaysia do very poorly during the pandemic. Also, the sum of money of money in circulation, the rate of inflation, and the interest rate have nothing to with how the stock market does in Malaysia during pandemic.


Keywords

Stock market performance, Macroeconomic factors, KLCI index