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African Research Review

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Environmental factors influencing fluctuation of share prices on Nigeria stock exchange market

U Gunu, IO Idris

Abstract


Financial markets could be money or capital markets. The commodities
traded on these markets are financial instruments as equities. In Nigeria most quoted companies release their share prices on daily basis. The prices of equities fluctuate as a result of changes in the macro environment of the market from time to time. What are these environmental variables that affect the fluctuation of share prices in Nigeria? The objective of the research is the examination of macroeconomic variables that are responsible for share price fluctuation in Nigeria.Secondary data of Nigerian stock market share prices covering between 1980-2006 were used. Multiple regression was used to analyse the data. The results show inflation, money supply, total deficits index of industrial production, interest rate and GDP influence stock prices. It is recommended that in order to monitor and control stock prices in Nigeria through macroeconomic variables, emphasis should be given to money supply, GDP, and total deficits.



http://dx.doi.org/10.4314/afrrev.v3i5.51152
AJOL African Journals Online