ABSTRACT
In developed economies, the problem of growth is largely solved by monitoring business activity of various management objects (national economies, industries, companies, etc.) on a regular basis. The business activity indicators describe expectations of future profits and future changes (expansion of production, investment in factories and equipment) and thus fulfill the function of predicting the turning points of the economic cycle. This chapter investigates the Russian and foreign diffusion index of business activity from the standpoint of performing the functions of the barometer for the national economy. To establish the relationship between the indices of business activity and national stock exchange, the correlation and regression analysis and Granger causality test were used. The results showed that the Russian indicators of business activity are related to stock market indices to a lesser extent than in the US and Germany. The speed of response of the Russian stock market indices to changes in the business activity is also lower than abroad.
