Stock Market Performance and Selected Macro Economic Variables in Nigeria
Keywords:
Stock Market Performance, Market Capitalisation, Macroeconomic Variables, GDPAbstract
This paper examined the relationship between aggregate stock market performance as proxied by market capitalisation and some selected macroeconomic variables in Nigeria between the periods of 1981 to 2022. The extent and nature of these relationships are examined to aid policymakers and investment decisions. The study employed ex-post-facto research design. The time series data used covered the period 1981-2022. The data were obtained from the Annual Statistical Bulletin of the Central Bank of Nigeria. The population for this study consists of the national economic data that is pertinent to this research. The sample size is the 42years annual statistical report determined using purposive sampling technique. The model for this study is built on the assumptions of the APT model which is a multiple regression model. The APT model is built as a multi factor model hence the Multiple Linear Regression Estimation was used. Unit Root Test, Cointegration Test which shows long run relationships among selected variables which shows that only GDP has a uni-directional relationship with Market Capitalisation. Of all the selected variables, only GDP shows a positive and significant relationship with market capitalisation. Recommendations made was in favour of expansion of the country’s GDP in order to further improve stock market performance as proxied by Market Capitalisation.
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