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International Journal of Economics, Finance and Management >> Volume 5, Issue 2, June 2016

International Journal of Economics, Finance and Management

Oil Price Dynamics and the Nigerian Stock Market: An Industry Level Analysis

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Author Kehinde John Akomolafe, Jonathan, D. Danladi
ISSN 2307-2466
On Pages 308-316
Volume No. 3
Issue No. 6
Issue Date November 01, 2020
Publishing Date November 01, 2020
Keywords Oil price, all share index, sartorial return, VECM


The Nigerian economy is blighted by a series of instabilities, when there is a significant fluctuation in the international price of crude oil thanks to the economy�s over-reliance on the oil sector. This paper analyses the relationship between the industrial stock returns and changes in oil price. The variables considered include stock market returns for the selected industries; banking, oil and gas, and construction industries. World oil price and market all share index to capture stock market size. Co-integration and Vector Error Correction mechanism were. The result indicates that industries belonging to sectors apparently do not directly affected by oil prices, are also sensitive to oil price changes. The banking sector responds mostly to change in oil price. The paper concludes with recommendation that policy makers have to take into cognizance the trend in oil prices in the formulation of policies that affect the stock market.

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