 Steel scrap and equity market in JapanAkihiro Omura, Neda Todorova, Bin Li and Richard Chung Resources Policy, 2016, vol. 47, issue C, 115-124 Abstract: Steel scrap is an important raw material in the steel making industry. As steel is a vital metal in modern life, the price of steel scrap is viewed as an important indicator of the macroeconomic activity. Steel scrap is consumed mainly in the electric arc furnace steel making, which represents approximately 30 per cent of the world annual steel production. Unlike other minerals including iron ore, both the supply and consumption amounts of steel scrap can be relatively easily adjusted based on the contemporary industrial activity level. For this reason, the steel scrap price reflects the condition of the macro economy and thereby it can be used as an indicator of future stock market performance in the country by market participants. Nevertheless, there is not much research on the market of steel scrap. This study aims to close this gap by testing the lead–lag relationship between the changes of steel scrap price and the aggregate Japanese stock market movement. Our empirical analyses suggest that the steel scrap price changes are informative in explaining the future stock market performance in Japan. Keywords: Equity markets; Commodity markets; Metal markets; Steel scrap; Forecasting; Japan (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:47:y:2016:i:c:p:115-124 DOI: 10.1016/j.resourpol.2016.01.001 Access Statistics for this article Resources Policy is currently edited by R. G. Eggert More articles in Resources Policy from Elsevier |
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