In what determines the stock price, we know that the rise and fall of the stock is due to the change of supply and demand. There are many factors that affect changes in commodity supply and demand. Only in terms of exchange rates, changes in a country’s exchange rate will affect the market that holds its own currency, and an increase means an increase in the exchange rate of RMB. Theoretically speaking, the impact of the exchange rate on the stock market is realized through the exchange of local currency and foreign currency. In an open market, if the exchange rate rises and foreign currency is exchanged for local currency, these funds may enter the stock market and cause increased demand. Prices will rise; on the contrary, if the exchange rate falls and the exchange rate of local currency increases, funds will flow to the foreign exchange market, which is not good for the stock market. In the actual market, the impact of the exchange rate on the stock market depends on the degree of openness of a country. In addition to the impact on the flow of funds, changes in the exchange rate most directly affect the import and export trade. When the exchange rate rises, the local currency appreciates, which is unfavorable for exports; when the exchange rate falls, the local currency depreciates, which is disadvantageous for export companies. These directly affect the performance of listed companies. In 2018, there was a trend of depreciation of the RMB, a surge in export orders for the textile industry, and a skyrocketing trend in the stock market, such as the trend of Huafang (600448). the
The impact of the exchange rate on the stock market is through the flow of funds and the performance of listed companies. The rise of the exchange rate has brought about an increase in foreign currency entering our country, which will flow into the stock market and cause benefits. However, for companies that need to export, it will have a negative impact due to the decline in product orders; the decline in the exchange rate will cause the outflow of local currency and capital outflow. Take advantage of. This also shows that the impact of the exchange rate and the stock market cannot be said to be completely positively or negatively correlated. Coupled with the downward trend in 2018, it can also be seen that the impact of the exchange rate on the stock market does not affect the trend of A shares in a large way. The financial impact is the key.
