The impact of macroeconomic variables towards the Islamic stock market in Malaysia / Siti Rahimah Abdu Raji

• Main Author: Abdu Raji, Siti Rahimah
• Format: Student Project
• Language: English
• Published: 2017
• Subjects: Macroeconomics; Bank stocks. Banking as an investment; Stock price indexes. Stock quotations; Finance, Islamic
• Online Access: https://ir.uitm.edu.my/id/eprint/50103/1/50103.pdf; https://ir.uitm.edu.my/id/eprint/50103/
• Institution: Universiti Teknologi Mara

Many studies have been conducted in determining the variables that could influence the stock market. Few literatures are considering the relationships between returns in Islamic stock market in regional level, which in this case, Malaysia with the macroeconomic variables. The relationships of the variables are to be observed by using the Ordinary Least Square (OLS) method. The current study is reinvestigating the relationship and the determinant of dominant variables towards the returns of stocks traded in Malaysian Islamic stock market which is known as FTSE Bursa Malaysia EMAS Shariah Index (FBEMS). The examined period is post global crisis in 2007 which is between 2010 until 2015 as according to the availability of data. For diagnostic checking, there are no multicollinearity and heteroscedasticity problem although there is an autocorrelation problem. The findings showed that M3 and L TR are both significantly positive towards Pl while CPI and XR are negatively related. It is also shown that IP/ and STR are insignificant towards the return of the Islamic market. Moreover, it shows only CPI, M3 and STR Granger cause for Pl in a unidirectional causality relationships while XR is in bidirectional relationships towards Pl.