Abstract:

The allocation of a trust environment in the economy is important for investors’ current and future investment decisions. The stock markets are an important indicator in the financial markets in the point of assessing their investments for national and international investors. In this context, the impact of the element of trust in the economy on investment decisions of investors is a topic of discussion in literature. From here on, the study examines the causal relationship between the trust indicators and the stock markets. In this framework, the relationship between both the international trust indicator (CDS) and the trust indicators calculated in Turkey (Financial Services Trust Index, Real Cutting Trust Index and Consumer Trust Index) and the stock market and sub-sectors was analyzed between the periods 2012:05-2018:11. The Boootstrap Cause Test developed by Hackers and Hatemi-J (2012) for the whole sample in the study, taking into account structural changes that occur over time with the Boootstrap Cause Test etc. The Bootstrap Rolling Windows (Bootstrap Rolling Windows) cause test developed by (2010) was applied and comparative. According to the findings obtained, the CDS, the Financial Services Trust Index and the Real Cutting Trust Index, respectively, indicate a causal relationship with the BIST100, BIST Industry and BIST Financial sectors and can be stated that there is a one-way causal relationship between these variables. The BIST100 index affects the Consumer Confidence Index and the causality relationship between the two variables is one-way.