Long-Term Trends in Equity Price: Nigeria

This study adopted critical analytical approach using relevant theories and empirical reviews, argued the positive relative impact of equity price movements on its relative macroeconomic variables in the long-term Nigerian equity market performance. The study shows that the relative movement of the NSE all share index is closely linked to the relative movement in real GDP and liberalization of financial market in the long term, but less so to inflation. Though short term positive relation was observed for inflation, but in the long-term the relationships appears negative. But the level of these influences is difficult to ascertain based on the limitation of the study. However, the way that share prices are determined may appear to have support from the weak version of the efficient market hypothesis, although the same support is not seen in all other markets, this may be seen as an indicator of the desire for logical and assessment taking place, but it should also be remembered that there is mixed evidence regarding the potential accuracy of any EMH in any market, and as such this is the least definitive aspect of the study and we may expect both support and contradiction to occur, with potential changes as the stock market evolves. There are time and space constraints and the utilization of an approach that is based on secondary research only, resulting in a paper that will be interesting and relevant, but will benefit from further research including primary research to assess support for the findings and better empirical techniques to answer most of the questions our observations could not adequately addressed. Relevance to Development Studies The relationships between long-term equity price movements and macroeconomic variables has recently been a major source of concern to academics, pol-icy makers and market practitioners especially the new comers in the market with little or no knowledge of the market. The study will contribute to the literature particularly on the determination of equity pricing in Developing Countries and the causes of equity market crisis. Therefore, it aims to add to the body of Knowledge on Nigerian equity market, which of course is relatively small in size and point the way for more enquiry into the subject for further studies. The study is also very relevance to development because it is basically aims to influence policy on the equity and inform on the relative roles of levels fundamentals as well as market regulation and macroeconomic influences in the determination of markets movement.