Evaluation of Market Efficiency in the Sectoral Indices of the Indian Stock Market: An Investigation on the Bombay Stock Exchange

Abstract

The Stock Exchange's Sectoral Index Analysis is a method of gauging economic expansion of a nation. It measures the important aspects of a nation's economic growth. Additionally, the government and investors may use it as a reference guide to know more about the financial health of a country with the help of the studies conducted on the indices of various sectors of the economy. This paper suggests utilising the Runs Test and Autocorrelation Test to evaluate the market efficiency of the Indian market by testing the BSE's sectoral indices. The BSE Automobile Index, BSE Bankex, BSE Capital Goods Index, BSE Health Care Index, BSE Metal Index, BSE PSU Index, and BSE Realty Index indicated substantial returns at 5% level of significance during the course of the research.