|
This thesis explores the lead-lag relationships between the sales of the four selected industries related to fire equipment and the Taiwan busiess cycle as well as the highs and lows of the Taiwan stock market index. The four selected industries include “the wiring accessories industry”, “the pump, compressor, stop-cock and valve industries”, “the optical instruments and equipment industry”, and “the refractory materials industry”. The Business Cycle Indicators are obtained from the National Development Council and Statistics. The data set covers a period between January 1993 and December 2018, a total of 312 months. The conclusions are the following:
1.When the economy and the stock market are in their low periods, the sales of the pump, compressor, stop-cock and valve manufacturing industries leads others to reach the lows. This trend shows that a turn in market condition will be proceeded by demand within these industries and thus react to their lead. Hence, the supply and demand for pumps, compressors, stop-cocks and valves can serve as a leading indicator when the market is contracting.
2.The wiring accessories industry serves as a lag indicator whether the economy and stock market are in their peak and low periods. Economic and market conditions can provide a reference for business managers in the wiring accessories industry to adjust their inventory.
3.The wiring accessories industry experiences smaller fluctuations as the economy and stock market go through their cycles of peaks and lows, in comparison to the optical instruments and equipment industry. The evidcnce highlights that the wiring accessories industry experiences a lesser impact than optical instruments and equipment, regardless of the phrases of the business cycle and stock market conditions.
|