MULTINATIONAL CORPORATION INVESTMENTS, MACROECONOMIC STABILITY AND DEVELOPMENT OF THE NIGERIAN (BOURSE) STOCK EXCHANGE
Abstract
This study attempts to analyze the impacts multinational investments have on macroeconomic stability and the level of development in the Nigerian bourse from 1999-2022. Historical data are sourced and collated from bulletins of the Central Bank of Nigeria (CBN) and Nigerian Exchange (NGX) for various years. An empirical assessment of the relationship between macroeconomic conditions and stock market performance in Nigeria. The findings of the Johansen cointegration result indicated a long-term correlation between multinational investments, macroeconomic stability, and stock market development. The ECM findings showed that the adjustment coefficient is statistically significant and negative at -6.6901, indicating that movement from the equilibrium level of development in the local bourse will be adjusted by 66.90 percent in the upcoming period from the current one. The growth of the burse has been significantly but positively impacted by direct foreign investment, but the exchange rate has been positively but not significantly. In contrast, the inflation rate had a negative and insignificant impact on the Nigerian stock market development. The study makes the recommendations that policymakers should prioritize attracting foreign direct investments into the local bourse and implement economic measures to strengthen the value of the national currency in Nigeria.