Symbiotic Disclosure of Real Sector and Financial Sector: Evidence in Nigerian GDP and Stock Market

The goal of this research is to find any discrepancies between the real and financial sectors, as well as to reveal their activities alongside macroeconomic elements, prior to the onset of Nigeria's fair recession in 2016 and 2017. The never-ending debates about whether the financial sector is a host or a parasite of the actual economy provide the impetus for this research. As a result, this study looked at the current casual disclosure between Nigerian stock performance and GDP, as well as other macroeconomic variables including exchange rate, foreign reserves, inflation rate, and interest rate data from the Central Bank of Nigeria, from 1985 to 2014. We used the Augmented Dickey-Fuller and Granger Causality tests. The findings reveal a strong symbiotic relationship between Stock Market Capitalization and GDP in the growth process, as well as GDP. Interest rates, on the other hand, tend to impact market capitalization activities. The study indicates that GDP and Stock Market Capitalization are important influential factors in the Nigerian economy since they both encourage each other, and interest rate inferences are based on Stock Market Capitalization movements. The financial and real sectors both function within and obey the demand follow and supply leading theories, according to the consequences of these results. To maintain the symbiotic disclosure revealed in this study, the Central Bank of Nigeria should partner with the Bank of Industry and the Agricultural Development Bank to give soft loans to skilled businesses. Finally, in order to develop, the CBN should correctly handle macroeconomic factors.

Please see the link :- https://globalpresshub.com/index.php/AJEFM/article/view/828