Impact Of Oil Price Changes On The Market Capitalization Of The Nigerian Capital Market

Agbo, Elias Igwebuike (2020) Impact Of Oil Price Changes On The Market Capitalization Of The Nigerian Capital Market. Saudi Journal of Economics and Finance. pp. 525-542. ISSN 2523-9414

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Abstract

The objective of this study was to determine the impact of oil price changes on the Nigerian market capitalization focusing the nonlinear autoregressive distributed lag model. The series consisted of monthly data points from 1997:1 to 2020:8 totaling up to 284 observations obtained from the Nigerian stock market and Energy Information Administration data stream. The two variables were found stationary at first difference. The results of the study show that both positive and negative innovations in international oil price have significant and direct impacts on the Nigerian market capitalization in the short run. The study recommends that policymakers should be cognizant of oil price movements. When oil price changes take place, relevant monetary policy measures should be employed to stabilize the unanticipated impacts on market capitalization that may distort the Nigerian economy. In addition to diversifying away from oil to reduce market volatility. Nigeria should devise strategies that can ensure stability in its capital markets by vigorously pursuing pro-growth policies irrespective of the shocks in oil price and other exogenous macroeconomic indicators.

Item Type:	Article
Subjects:	H Social Sciences > HJ Public Finance
Divisions:	Faculty of Management and Social Sciences
Depositing User:	mrs chioma hannah
Date Deposited:	04 Oct 2021 09:01
Last Modified:	04 Oct 2021 09:01
URI:	http://eprints.gouni.edu.ng/id/eprint/3188

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