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Stock returns and economic forces—An empirical investigation of Chinese markets
Journal article   Peer reviewed

Stock returns and economic forces—An empirical investigation of Chinese markets

Xiaoyu Chen and Thomas C. Chiang
Global finance journal, v 30, pp 45-65
May 2016

Abstract

Chinese stock market Economic fundamentals GARCH Illiquidity Stock return
This study finds evidence that a better macroeconomic climate and an improvement in liquidity help to explain Chinese stock returns. There is no evidence to support the hypothesis that growth in dividend yields can predict stock returns. The sectoral stock returns in China's markets are correlated with stock returns in the US markets as evidenced by: (i) a positive correlation with US stock returns; (ii) a significant negative error correcting term; (iii) a negative response of Chinese stocks to financial stress in the US market; and (iv) a positive correlation with a depreciation in the China/US exchange rate.

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18 citations in Scopus

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#8 Decent Work and Economic Growth

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Collaboration types
International collaboration
Web of Science research areas
Business, Finance
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