TAF PUBLISHING

Purchasing Managers’ Index (PMI) is an indicator to measure the health of an economy. PMI is considered by policymakers and related bodies as it is an influential indicator for gauging the general tendency of the economy, especially GDP growth and Industrial Added Value. This study examines whether the manufacturing PMI has any influence on the stock market of Turkey or vice versa. We use the secondary sources of information collected from the official website of BIST, Turkey for Stock Index data and “investing.com” for Manufacturing PMI data. The study covers monthly data ranging from April 2015 to February 2019. We test the causality between Manufacturing PMI and BIST index by employing the Granger Causality Test. Our analysis reveals that manufacturing PMI does not granger cause the Turkish Stock Index but the Turkish Stock index or the stock market does granger cause manufacturing PMI. This study is the first attempt by the authors, which covers data of manufacturing PMI from April 2015 to February 2019 as no further data is available to be dealt with.