| Abstrakt: |
The Nigerian capital market in recent past have been rattled with global financial crisis due the integration of countries, people, businesses and markets around the world with the aim of executing trade without difficulty or barrier; but has also brought remarkable progress in terms of increase in capital base, fund accessibility and economic growth. However, dimension of growth in the Nigerian market is enshroud in the midst of globalisation and capitalisation of the financial sector and as such filtering the exact impact of globalisation became compelling. This study examines the impact of globalization on the performance of the Nigerian capital market using a time series secondary data obtained from records of Central Bank of Nigeria and Nigeria Stock Exchange fact-book for 35 years (1980-2014) such that globalisation was proxy by external reserves (ER), exchange rate(EXR), balance of trade(BOT), foreign direct investment (FDI), interest rate (INT) and international oil prices(PO) while the market performance was measured by capitalization (MCAP). Stationarity, serial/auto correlation tests and Causality tests were carried out while Error Correction Model was used to determine the impact of globalisation on performance. Generally, the study finds that globalisation exerts a significant impact on performance of the Nigerian capital, but in specific terms, a unit change in (BOT) and (FDI) will increase the performance of the Nigerian capital market by 21% and 37% respectively while (INT) has a negative impact (-0.87) on the market performance as (EXR)and (ER) reveals no significant impact. Further results show that all the variables are stationary at level, absence of serial/auto correlation and lack of heteroskedasticity. However, a unidirectional relationship exist between (INT) and (MCAP), no relationship with (EXR) but causal relationship exist between (ER and (PO) and between (BOT and EXR).The study recommends that the Nigerian government should implement sound economic policies that would attract (FDI) foreign investors into Nigerian capital market, and maintain favourable (BOT), promote non oil export and put interest rate at constant check. These will strengthen the Nigerian capital market to confront the threats posed by globalization and grow out of the current global financial crisis. [ABSTRACT FROM AUTHOR] |
