Open AccessSocial and Economic Drivers of Stock Market Performance in Nigeria
Author(s) -
Ismaila Akanni Yusuf,
Mohammed Bashir Salaudeen,
Hope Agbonrofo
Publication year - 2021
Publication title -
journal of economic impact
Language(s) - English
Resource type - Journals
eISSN - 2664-9764
pISSN - 2664-9756
DOI - 10.52223/jei3032102
Subject(s) - life expectancy , poverty , stock market , interest rate , stock exchange , population , business , exchange rate , economics , stock (firearms) , monetary economics , economic growth , finance , geography , context (archaeology) , demography , archaeology , sociology
The study examines the effect of the social and economic indicators on the stock market performance in Nigeria between 1981 and 2019. The study employs secondary data from the World Bank and Central Bank of Nigeria using the ordinary least squares as the technique of estimation. Findings show that regarding the economic drivers, interest rate, exchange rate, and inflation rate negatively impact the stock market while only income exerts a positive impact. However, both income and interest rate are significant economic drivers of stock performance. Regarding social drivers, life expectancy, poverty, and population exert a positive impact on stock performance. Similarly, both life expectancy and population are significant social drivers of stock market performance in Nigeria. The study recommends that monetary authorities should be cautious in avoiding discretionary policies that might hike the exchange rate; otherwise, the flow of funds to the stock market will be derailed. Also, the fiscal authority should invest massively in safety nets programmes to enhance the capacity of the growing population and reduce poverty.