Open AccessReconciling Macroeconomic Determinants with Stock Market Performance in Selected Sub-Saharan African Countries: an ARDL Approach
Author(s) -
Kareem Abidemi Arikewuyo,
Akeem Adekunle Adeyemi,
Eunice Titilayo Omodara,
Lateef Adewale Yunusa
Publication year - 2020
Publication title -
journal of banking and financial economics
Language(s) - English
Resource type - Journals
ISSN - 2353-6845
DOI - 10.7172/2353-6845.jbfe.2020.1.2
Subject(s) - distributed lag , stock market , economics , stock (firearms) , monetary economics , stock market bubble , overtime , oil price , cointegration , autoregressive model , econometrics , macroeconomics , financial economics , geography , labour economics , context (archaeology) , archaeology
Prior studies have adduced unstable macroeconomic factors to stock price movement overtime but the relationship between the duo remained unsettled. Autoregressive Distributed Lag (ARDL) technique was used to reconcile the macroeconomic determinants with performance of stock markets in selected Sub-Saharan Africa (SSA) covering the period of 1999:1–2017:4. It was found that macroeconomic indicators were essential in determining stock market performance in Nigeria while South African stock market did not show any predictable linkage but the contemporaneous effect of oil price changes on stock market performance in selected SSA. The study, therefore, recommended that countries in SSA should reduce overdependence on oil to minimize external influence in order to promote stability of the stock markets.