Macroeconomic variables and its causality between sctok market prices during worldwide financial crisis: Lithuanian case

Abstract

It is often claimed that stock prices are determined on the basis of some key macroeconomic indicators. That means that macro-economic factors may influence investors' decisions to invest and motivates many researchers to investigate the stock market prices and macroeconomic relationships. Different authors choose different macroeconomic variables to determine their relationship with stock market prices in different countries. But in the context of Lithuania, not many studies can be traced in literature, so this article has examined the causal relationship between macro-economic indicators and stock market prices in Lithuania. The data from January 2007 to June 2010 have been used to analyze the causal relationship between various macro-economic variables and stock exchange prices under unusual conditions – financial crisis. The stock exchange prices have been represented by the general price index of the OMXV.