Analyzing the Connection between Macroeconomic Variables and Market Performance: A Panel Study from an Emerging Economy

Abstract

This study explores at how Pakistan's market performance is affected by macroeconomic factors from 2014 to 2023. The World Bank's Development Indicators (WDI) dataset and annual reports are the sources of the data. In this research study, the panel data was analyzed using GMM. This research advances the field by using features of macroeconomic variables instead of firm-level elements. The empirical finding demonstrates that macroeconomic factors support non-financial companies' market performance in Pakistan. Companies operative in Pakistan should be concerned of the possible influence of these factors on market performance and search for new methods to deal with them. The macroeconomic variables effectively enhance market performance. Policymakers and investors need to take these facts into consideration while choices are being made on economic policy and investments.