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Emerging countries’ economies are dependent on foreign capital inflows. For policy makers and researchers of particular interest is to understand the nature of these flows and their impact on the domestic capital market. The first significant foreign inflows entered the Macedonian Stock Market at the end of 2004, and stock prices were increased. It was general belief among the investors that foreigners are driving the prices on the Macedonian Stock Market. This study examines the influence of foreign investors’ trades on stock returns in Macedonia using base broadening and price pressure hypotheses. Strong evidence consistent with the base-broadening hypothesis shows that 1% of monthly net inflows as a percentage of last month market capitalization is connected with 7% rise in monthly returns on the Macedonian stock market. The findings do not support the price pressure hypothesis, so the rise in the prices is permanent.

Purpose: The study tests conventional and behavioral pricing multifactor impact on price fragility from the equity market of Pakistan.Methodology: The positivist approach is used to deduct study rationale via probability sampling. At the same time, systematic sampling for data collection of PSX is tested in parallel to mean-variance random walk theory.Findings: The impact of conventional factors is significant on price fragility in the short run and vice versa in the long run. Specifically, herd behavior and disposition effects are found to be insignificant. But size, value, illiquidity, and price earning had a significant impact on price fragility in the short run.Limitations: The current research has not covered the desired scope of the topic due to time limitations, lack of harmony in corporate data on databases, and literature on price fragility being very scarce.Implication: In PSX, there is a need to develop a corporate culture to promote the standard modern financial practice to enhance financial productivity and sustainability. For corporate culture to be established, corporate governance boards should be established, and family governance systems should be replaced by an independent democratic board. Mispricing and arbitragers need serious control.Originality: The value of the research is that little research currently exists on about pricing multifactor impact on price fragility.

The article shows that for the conditions of a closed market for bor- rowed capital, there is an optimal capital structure of the corporation, ensuring maximum profitability of own funds invested in financing operating costs, and acceptable capitalization due to the increase in the market value of shares.

This paper tests for equity market integration between Sweden and EU countries represented by Germany and France. A new causality test method developed by Hacker and Hatemi-J (2006) is applied. This method performs better than the other methods because it is robust to non-normality and the presence of ARCH effects in the financial data. The results show that Sweden did not have a significant causal relationship with Germany and France during the period before Swedish membership in the EU. However, for the period after Sweden joined the EU (in 1995), we find that Sweden became significantly linked with both Germany and France. We interpret these empirical findings as supporting the proposition that the Swedish financial market has become more integrated with the EMU area.

An export-oriented development strategy fostered the Asia Pacific region’s economic success, making it the fastest growing region in the world. In recent years, despite waning demand from the crisis-hit Western economies, the accelerating demand from China boosted intraregional trade in Asia. Although China’s Asian trading partners benefit from increasing exports to China, this stronger linkage with China has made them more vulnerable to the risk of a Chinese slowdown. This paper examines the impact of a negative Chinese gross domestic product (GDP) shock on Asian economies by employing the Global Vector Autoregressive (GVAR) model, using the dataset through the third quarter of 2014 for 33 countries. The analysis finds that a negative Chinese GDP shock impacts commodity exporters, such as Indonesia, to the greatest extent, reflecting both demand and terms of trade shocks. Export-dependent countries in the East Asian production cycle, such as Japan, Malaysia, Singapore and Thailand, are also severely affected. The analysis also finds that a negative shock to China’s real GDP would not only have an adverse effect on the price of crude oil, as some previous studies have also shown, but also on the prices of metals and agricultural products. The study also investigates the impact of a potential negative shock to the real GDP of the United States on Asian countries, and determines that although the U.S. economy has a larger influence on Asian economies than China’s economy, the Asian countries are more exposed to China than ever through increased economic ties.

The analysis o f this study is twofold: 1) Using A non-linear test (the Hinich test), it provides evidence of non-linear dynamics in stock prices in the American market from January 1955 to December 2002. 2) Utilizing non-linear regression models, the Multiple Adaptive Regression Splines (MARS) and fl-Splines, the study examines the relationship between stock prices and their fundamentals. Non-linear results are compared with linear. The predictive ability ofthe non-linear models outperforms the linear. As a result, the study suggests that non-linear models should be consideredfor the analysis ofstock prices.

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This study utilizes financial pooled data and investigates the relationship between the price of equity with payout and retained earnings of firms that operate in Istanbul Stock Exchange (ISE), Turkey. Three regression models are constructed to test the hypotheses. The results suggest that the determinants of price of equity presented by the finance theory appear to be relevant for the ISE service and industry sectors. Payout and retained earnings both seem to have an effect on the level of equity price of the firms. Furthermore, the results indicate that time and sector affects the levels of equity price., Bu çalışmada havuz veriler kullanılarak İstanbul Menkul Kıymetler Borsası MKBI sanayi ve hizmet sektörlerinde faaliyet gösteren firmaların hisse senedi fiyatları ile nakit temettü ve otofinansman arasındaki ilişki araştırılmaktadır. Araştırma hipotezlerini sınamak için üç regresyon modeli geliştirilmiştir. IMKB sanayi ve hizmet sektörlerinde faaliyet gösteren firmalar üzerinden elde edilen bulgular. finans yazımındaki hisse senedi fiyatları ile nakit temettü ve otofinansman arasında beklenen pozitif yonlu ilişki güçlu bir şekilde desteklemektedir. Firmaların nakit temettü ve otofinansman düzeylerinin hisse senetlerinin tiyatlan uzerinde onemli bir etkiye sahip olduğu görülmektedir. Ayrıca araştırma sonuçları, sektör ve zaman faktörlerinin hisse senedi fiyat düzeyleri üzerinde etkili olduğunu göstermektedir.

Tests for unit roots in log dividend yields, which are consistent with `rational bubbles' in stock prices, are conducted for the S&P500 and Finnish stock market indexes.In addition to the traditional unit root tests, we split the data into 10-year segments and use frequency domain analysis to test for the presence of unit roots in the dividend yield data.The results strongly suggest the existence of bubbles in both the US and Finnish markets.Finally we develop a novel dividend yield-based method to track periods when stock prices divert their fundamental levels. This indicator produces promising results, as it seems to have some forecasting ability concerning booms and busts in the stock markets.