scholarly journals Evaluation of the Impact of Macroeconomic Variables on Stock Market Performance in Nigeria

2019 ◽  
Vol 5 (2) ◽  
pp. 34 ◽  
Author(s):  
Cordelia Onyinyechi Omodero ◽  
Sunday Mlanga
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Stock Market ◽  
Price Index ◽  
Market Performance ◽  
Share Price ◽  
Series Data ◽  
Macroeconomic Variables ◽  
Stock Market Performance ◽  
The Impact

Stock market is an essential part of a nation’s economy and requires adequate evaluation of all factors that militate against its performance. This study investigates the role of macroeconomic variables in determining the stock market performance in Nigeria using annual time series data covering a period from 2009 to 2018. These data have been sourced from the World Bank Development Indicators, International Monetary Fund and CBN Statistical Bulletin. The results from the regression analysis indicate that exchange rate and interest rate do not have significant impact on share price index while inflation rate exerts a significant negative influence on share price index. On the contrary and in line with the concept of GDP and stock market performance, GDP significantly and positively impacts on share price index. The study among others suggests that the growth of the economy should be maintained to keep stock market flourishing while macroeconomic variables such as inflation, interest rate and exchange rate should be appropriately regulated by the relevant authorities to curtail all negative influences on stock market performance.

Macro-Economic Variables and Stock Market Performance: Empirical Evidence from Colombo Stock Exchange

2020 ◽  
Vol 05 (02) ◽  
pp. 106-118
Author(s):  
M. Amaresh ◽  
S. Anandasayanan ◽  
S. Ramesh
Keyword(s):  
Interest Rate ◽  
Correlation Analysis ◽  
Stock Market ◽  
Price Index ◽  
Market Performance ◽  
Ordinary Least Squares ◽  
Share Price ◽  
Macroeconomic Variables ◽  
Stock Market Performance ◽  
The Impact

Stock market performance is considered as a significant indicator of financial and economic circumstances of a country. In a nutshell, a secured and regulated financial environment is being provided by the stock market where shares can be transacted at lower operational risk. The stock market also functions as a platform through savings, and investments of individuals are channelized into productive investment proposals. It allows capital formation and economic growth for the nation. The ultimate objective of this study is to examine the impact of macroeconomic variables on stock market performance. The macroeconomic variables (independent variables) used in this research study are Inflation, Interest Rate, and GDP. Stock market performance (All-Share Price Index) is the dependent variable. 120 Monthly observations from January 2009 to December 2018 had been taken for the study. The Augmented Dickey Fuller’s unit root test, Ordinary Least Squares Regression and Correlation analysis were applied to the variables. The results of correlation analysis indicated that inflation and Stock market performance are positively associated meanwhile interest rate, and GDP and Stock market performance are negatively correlated. The Ordinary Least Square results showed that nearly 75% of the variation in all share price index is explained by the three macroeconomic variables, GDP, TB and WPI. The study suggested some of the possible reasons for the positive impact of Inflation on the Colombo Stock market performance, and negative impact of Interest Rate on Stock market performance and recommended that efforts should be made to improve the Stock market performance.

scholarly journals Dynamic impact of Gold Prices, Oil Prices and Exchange Rate on Stock Market Performance: A Case of Pakistan’s Stock Exchange (KSE 100 Index)

2021 ◽  
Vol 7 (1) ◽  
pp. 1-12
Author(s):  
Asif Ali ◽  
Muhammad Kamran Khan ◽  
Hamid Ullah
Keyword(s):  
Exchange Rate ◽  
Stock Market ◽  
Foreign Exchange ◽  
Market Performance ◽  
Oil Prices ◽  
Series Data ◽  
Macroeconomic Variables ◽  
Term Relation ◽  
Stock Market Performance ◽  
The Impact

Currently emerging markets are passing through economic turmoil due to considerable increases in the prices of oil and gold with significant variation in the foreign exchange market. All the macroeconomic variables are touching the highest value which was never occurred in the history of Pakistan. Taking advantages of the current situation the study has examined the impact of gold prices, oil prices and exchange rate on stock market performance. For this purpose, the study has used daily data of these macroeconomic variables for the period of 2003 to 2018. By using time series data analysis, it reveals that there is no co-integration or long-term relation among these variables; however, the vector autoregressive model showed significant short-term relation among the securities market performance, foreign exchange rate, prices of oil and gold. The analysis also suggests that significant changes in the prices of oil, foreign exchange rates and the prices of gold have a negative lagged effect on the performance of the stock market.

scholarly journals Economic Interactions among Stock Market Performance and Macroeconomic Variables with Mediating Role of Gold Prices Volatilities: An Evidence from Pakistan

2021 ◽  
Vol 7 (3) ◽  
pp. 383-394
Author(s):  
Rukhsana Rasheed ◽  
Mazhar Nadeem Ishaq ◽  
Rabia Anwar ◽  
Mehwish Shahid
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Stock Market ◽  
Inflation Rate ◽  
Market Performance ◽  
Stock Market Index ◽  
Macroeconomic Variables ◽  
Market Index ◽  
Stock Market Performance ◽  
The Impact

In all emerging economies, one of the most challenging issues for investors is the multifaceted inter-relationship between volatility of gold prices and stock market index. During the COVID-19 sub-periods, gold has shown a strong hedging behavior against stock market performance. The main objective of this study was to quantify the long-run relationship among multiple independent macroeconomic variables (predictors) on stock market index (response variable) using the volatilities of gold prices as a mediator factor. This study applied the descriptive statistics, correlation, t-test and OLS multiple regression Model. The specific data comprised of period 2011-2020 regarding the fluctuations in gold prices, exchange rate, interest rate, inflation rate and performance of stock market index has been utilized. The statistical outputs of models showed that exchange rate (Dollar to PKR) was positively affecting the performance of Karachi Stock Exchange (KSE)-100 Index, whereas inflation rate and interest rate were negatively affecting the overall performance of KSE100 index. The findings of this study suggested that to achieve better performance of stock market, relatively low interest rate and inflation rate contribute a significant role. However, to increase the generalization capabilities of this study the impact of mentioned macroeconomic variables in other sectors like industrial production, oil & gas and energy sectors with wider time span can be more helpful.

scholarly journals Determinants of Stock Market Performance

NCC Journal ◽  
2018 ◽  
Vol 3 (1) ◽  
pp. 134-142
Author(s):  
Ramjee Rakhal
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Literature Review ◽  
Stock Market ◽  
Money Supply ◽  
Market Performance ◽  
Major Objective ◽  
Macroeconomic Factors ◽  
Macroeconomic Variables ◽  
Stock Market Performance

This paper investigates the effect of selected macroeconomic factors viz. remittances, money supply, exchange rate, and interest rate on stock market performance based on literatures available in international and Nepalese context. The major objective of this paper is to find out the new area of research in Nepalese perspective with the help of literature review. The study demonstrates that remittance and money supplypositively affect the stock market whereas interest rate and exchange rate negatively affect the stock market performance. However, there is lack of consensus on the effect of each macroeconomic variables on stock market performance as it has number of literatures available which are similar as well as opposite to these findings. Thus, similar study can be extended employing different methodology with this combination of variables in Nepalese context that may better describe and analyze the performance of Nepalese stock market and helps to reduce the confusion among the literatures.NCC JournalVol. 3, No. 1, 2018, page: 134-142

scholarly journals Effect of Macroeconomic Variables on Stock Market Performance in Nigeria

2019 ◽  
pp. 1-14
Author(s):  
Emmanuel Isaac John
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Stock Market ◽  
Money Supply ◽  
Inflation Rate ◽  
Market Performance ◽  
Test Results ◽  
Macroeconomic Variables ◽  
Stock Market Performance ◽  
Negative Effect

This paper aims at examining the effect of macroeconomic variables on stock market performance in Nigeria using annual time series data spanning 1981 to 2016.The data were obtained from Central Bank of Nigeria (CBN) Statistical Bulletin. Four macroeconomic variables, namely: money supply, interest rate, exchange rate and inflation rate were used as independent variables, while market capitalisation (proxy for stock market performance) was employed as the dependent variable. The results of Augmented Dickey-Fuller (ADF) test revealed that all the variables studied were stationary at first difference except money supply which was stationary at second difference. The Ordinary Least Square (OLS) regression results showed that money supply has a significant positive effect; interest rate has a significant negative effect; whereas, exchange rate has a positive but not significant effect and inflation rate has a positive but not statistically significant effect on stock market performance. The cointegration test results disclosed that there exist a long-run relationship between the macroeconomic indicators and stock market performance. The Granger Causality test results revealed that a unidirectional causality runs from money supply and exchange rate to stock market performance. In conclusion, money supply and interest rate are the true factors influencing stock market performance in Nigeria because they exhibited a significant effect on stock market performance. Whereas, exchange rate and inflation rate indicated a weak (non-significant) effect on stock market performance. Consequently, the recommendations are: monetary policies that favour the supply of money in the economy should be pursued in order to ensure a better performance of the stock market; Interest rate should be relatively low to guarantee a higher performance of the stock market because high interest rate has a significant negative effect on the Nigerian stock market.

scholarly journals Do Macroeconomic Variables Affect Stock Market Performance? A Case Study of DSEX and DS30 Index of Dhaka Stock Exchange

2019 ◽  
Vol 9 (3) ◽  
pp. 182
Author(s):  
Emran Hasan ◽  
Shahanawaz Sharif
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Stock Market ◽  
Inflation Rate ◽  
Market Performance ◽  
Cointegration Analysis ◽  
Causality Test ◽  
Treasury Bill ◽  
Macroeconomic Variables ◽  
Stock Market Performance

Stock market performance– being the linchpin of an economy, requires variations in policies concerning macroeconomic variables. Keeping this in notion, this research assays the empirical association between stock market performance and a few selected macroeconomic variables namely interest rate, exchange rate, inflation rate, and 91-days Treasury bill rate using monthly data ranging from January 2013 to October 2018. Employing Johansen Cointegration analysis, the results of the study suggest that exchange rate and treasury bill rate are positive whereas interest rate and inflation rate are negatively associated with better stock market performance. Granger causality test implies bidirectional causality – between the interest rate and DS30 as well as DSEX while unidirectional causality is evident for both the indices which are running from interest rate, inflation and exchange rate to stock market performance. Formulation and implementation of prudent policies regarding the studied macroeconomic variables can lead to a healthy stock market outcome.

scholarly journals CORRUPTION AND STOCK MARKET PERFORMANCE IN NIGERIA

10.26458/1841 ◽  
2018 ◽  
Vol 18 (4) ◽  
pp. 23-40 ◽  
Author(s):  
Cordelia Onyinyechi Omodero
Keyword(s):  
Stock Market ◽  
Price Index ◽  
Market Performance ◽  
Data Availability ◽  
Share Price ◽  
Series Data ◽  
Corruption Perception Index ◽  
Stock Market Performance ◽  
Test Of Hypotheses ◽  
Corruption Perception

AbstractThe study examines the effect of corruption (using corruption perception index and Nigeria corruption ranking as proxies) on the stock market performance (proxied with share price index) in Nigeria. The study employed time series data spanning twenty years (1996-2016). Data availability especially on corruption indices was the major reason underlying the choice of period. The data were obtained from CBN Statistical Bulletin and Transparency International website. With the aid of SPSS version 20, the study used Multi-regression analysis and student t-test for the test of hypotheses.  The study finds a significant positive correlation between corruption and stock market performance in Nigeria.  The result reveals robust positive and significant relationships between Nigeria Corruption Ranking, Corruption perception index and Share price index.  The result of the study explains the integration of graft into the Nigerian economic system.  Therefore, adoption of a strong form of stock market efficiency by the Security and Exchange Commission (SEC) and Nigerian Stock Exchange (NSE) for actualization by all listed firms in Nigeria is hereby recommended.  In addition, we recommend that the Federal and State governments should formulate more result-oriented policies and rules that could help combat corruption more effectively.

scholarly journals The Impact of Commodity Prices, Interest Rate and Exchange Rate on Stock Market Performance: An Empirical Analysis From Malaysia

2020 ◽  
Author(s):  
Norhafiza Nordin ◽  
Sabariah Nordin ◽  
Rusmawati Ismail
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Stock Market ◽  
Palm Oil ◽  
Significant Influence ◽  
Market Performance ◽  
Commodity Prices ◽  
Oil Price ◽  
Stock Market Performance ◽  
The Impact

This paper examines the impact of commodity prices (palm oil price, oil price, and gold price), interest rate, and exchange rate on the Malaysian stock market performance. Employing the bounds test approach, the results of the study showed cointegrating relationships among variables. Specifically, the results revealed a significant influence of palm oil price on the stock market index. However, no significant influence was observed for both the oil price and gold price. Interest rate and exchange rate showed significant influences, which are consistent with past empirical studies. One important policy implication from this study is that the authorities should also pay attention to the effect of commodity prices, in addition to macroeconomic variables, in implementing relevant polices, as they may have a negative impact on the Malaysian stock market.  

scholarly journals Macroeconomic factors and LQ45 stock price index: evidence from Indonesia

2019 ◽  
Vol 16 (3) ◽  
pp. 251-259 ◽  
Author(s):  
Sugeng Hadi Utomo ◽  
Dwi Wulandari ◽  
Bagus Shandy Narmaditya ◽  
Puji Handayati ◽  
Suryati Ishak
Keyword(s):  
Exchange Rate ◽  
Stock Market ◽  
Stock Price ◽  
Price Index ◽  
Stock Exchange ◽  
Market Performance ◽  
Macroeconomic Variables ◽  
Stock Market Performance ◽  
Stock Price Index ◽  
The Relationship

This paper provides the relationship between macroeconomic variables, including exchange rate, BI rate and inflation, and stocks performance, particulary bluechip stocks listed in LQ45 index in Indonesia Stock Exchange. The study particularly gives insights on bluechip stocks listed in LQ45 stock price index in Indonesia Stock Exchange between 2015 and 2017. The data were obtained from various sources during the period, including the Indonesia Stock Exchange (IDX), the Central Bank of Indonesia (BI), and the Ministry of Trade. This study followed a Vector Error Correction Model (VECM) attempting to estimate the relationship between variables both in the short term and in the long term. The findings of the study showed that in the long run, exchange rate, BI rate and inflation have a negative impact on stock market performance, particularly on LQ45 index in Indonesia Stock Exchange. It implies that an increase in macroeconomic variables results in the decline of stock market performance. Meanwhile, in the short run, two variables, namely the exchange rate and inflation, positively affect stock market performance in Indonesia. On the contrary, the relationship between BI rate and stock market performance showed a negative correlation. These findings have significant implication for the understanding of how macroeconomic variables affect the stock market performance, particularly LQ45 price index in Indonesia Stock Exchange.

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