ANALYSIS THE EFFECT OF MACROECONOMICS VARIABLES TO STOCK PRICE INDEX IN INDONESIA (IHSG)

Capital market has a strategic role in the modern economy, so that capital market is also known as the primary indicator of the country's economy (leading indicator of economy). In carrying out its role, capital market has two main functions, the function of economic and financial function. In the function of economic, capital markets provide a facility or vehicle to bring together two interests, those who have excess funds (investors) and those who require funds. In capital markets, the parties have excess funds may invest those funds to obtain compensation (return), while the issuer (in this case the company) may utilize these funds for investment purposes without waiting for the availability of funds from the company's operations. In the finance function, capital markets gives the possibility and the opportunity to obtain return for the owner of the funds, according to the characteristics of selected investments. Capital market is expected to increase economic activity, since the stock market is an alternative long term financing for the company, so the company can operate with a larger scale and in turn will increase the company's earnings and prosperity of the community (Andrew, 2009)