Capital Markets Nigeria

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

COPY RIGHT © 2010 Institute of Interdisciplinary Business Research

399

JUNE 2010

VOL 2, NO 2

Performance Indicators of Capital Market and the

Economic Growth of Nigeria

BALDWIN CHUKWUNANU ASIEGBU

Dept. of Information Management Technology, Federal University of Technology,

Owerri, Imo State, Nigeria.

AKUJUOBI, AGHALUGBULAM BONAVENTURE CHIDIEBERE

Dept. of Financial Management Technology, Federal University of Technology,

Owerri, Imo State, Nigeria.

Abstract

The paper assessed the effect of Nigerian Capital Market performance indicators on Economic

Growth of Nigeria from 1997 to 2006. Employing the Ordinary Least Square Multiple

Regression Model, the two hypotheses formulated were tested in order to ascertain the nature of

relationship between the capital market and Nigeria’s economic growth. While economic growth

as the dependent variable was denoted by the-Gross Domestic Product (GDP) ,the Capital

Market performance indicators ,being the explanatory variables, were given as Market Turnover,

All- Share Index, Market Capitalization, Volume of Shares Traded, Number of Listed Securities,

Number of Listed Companies and Value of Issues. The result from the analysis and test of

hypotheses at 5% significant level showed that over the period considered, there exists a high

level of relationship between GDP and the seven Capital Market predictor variables as a whole.

However, taking them individually, the analysis revealed that, whereas Market Turnover, All-

Share Index and Number of Listed Companies have positive significant effect on Economic

Growth, Value of Issues exhibited no significant effect. Conversely, Volume of Shares Traded

and Number of Listed Securities exerted negative effects, though not significant. Surprisingly,

Market Capitalization was excluded from the model which implies that it is not actually an

independent variable for assessing the effect of...