Abstract:
This paper attempts to identify and appreciate the relationship between corporate earnings, interest rate and market price. This t study carried out on selected stocks which are actively traded on National Stock Exchange, Mumbai for the period from 2001 to 2006. Multivariate Regression Analysis technique is used to verify the relationship between explanatory (independent) variables and explained (dependent) variable. Results from the analysis reveal that the market price of securities is highly correlated with the corporate earnings (cash basis) as well as risk free rate of interest.
