Interrelations between capital market and fundamental processes in China

Financial markets are often called a mirror of economy. In the global world we can think of this statement in a global framework. The question put in the paper is whether Chinese capital market is dependent on the macroeconomic processes underlying huge economic growth in the last years. The analysis is projected using vector autoregression model and will be held on the basis of business cycle analysis in China. We expect to find the most representative market indicator that corresponds to the fundamental analysis.

Keywords: financial markets, financial indicators, fundamental analysis, VAR model

JEL: E44