AN EVALUATION OF THE PERFORMANCE OF NIGERIAN STOCK EXCHANGE IN THE ECONOMIC DEVELOPMENT OF NIGERIA

AN EVALUATION OF THE PERFORMANCE OF NIGERIAN STOCK EXCHANGE IN THE ECONOMIC DEVELOPMENT OF NIGERIA

A CASE STUDY OF NSE KADUNA BRANCH)

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ABSTRACT

The purpose of this project is to evaluation of the performance of the Nigerian stock exchange (NSE) in Nigeria and to the over all financial development of the economy. It would be noted that the success of an industry of firm depends largely on the capital recourses available to the industry and this will also be reflected in the development of the economy. It has been noted that with the cost importance of the capital market a lot has been achieved by the nation. It can be noted that capital investment is what is needed for Nigerian firms to break into the big economics this work. It contends that the capital market needed to be enhanced so as to effectively channel those resources to industries and firm. The methodology used in achieving the findings include gathering information from annual publications and fast books of the stock exchange business journals, annual publication from the central bank of Nigeria e.t.c A good capital market wit have a positive influence or effect I industrial financing. Industrial development in the country can be a determination of the financial resources available to it. This relationship between the capital market and the financing is a visual circle. If capital is made available for financing projects more fires and organizations will be listed on the stock exchange and this will enhance resources available both to a country and the living populace.

However, some recommendations have been given in the work to the operations of the market to help in overcoming the present problems faced by the stock exchange.

 

 

CHAPTER ONE

  1. Introduction

1.1     background of the study

1.2     Statement of the problem

1.3     Objectives of the study

1.4     Scope of the study

1.5     Research questions

1.6     Significance of the study

1.7     Historical background of the Nigeria Stock Exchange in the Economic Development

1.8    Definition of terms

 

CHAPTER TWO

Literature review

2.1     Introduction

2.2     Stock exchange of other countries

2.3     The role of Nigeria stock exchange in Nigeria economy

2.4     Government role in the operating of the stock market

2.5     The general management and control of the Nigeria Stock Exchange.

2.6     Capital Formation in Nigeria Stock Exchange

2.7     The Concept of economic Development in the Nigeria Stock Exchange

2.8     Transition of Lagos Stock Exchange to Nigeria Stock Exchange

 

CHAPTER THREE

Research methodology

3.0     Introduction

3.1     Method of data collection and Sources

3.2     Population and sample size

3.3     Sampling Techniques and Limitation

3.4     Method of Data Analysis

3.5     Justification for the choice

 

CHAPTER FOUR

Data presentation, analysis and interpretation

4.1     Introduction

4.2     Data presentation and analysis

4.3     Testing of hypothesis

4.4     Summary of findings

 

CHAPTER FIVE

Summary, conclusion, Limitation and recommendations

5.1     Summary

5.2     Conclusion

5.3     Limitation of the study

5.4     Recommendation

Bibliography

Appendix

 

 

 

CHAPTER ONE

1.0     INTRODUCTION

1.1     BACKGROUND OF THE STUDY

A buoyant and dynamic economy is the one built upon a sound financial system. Such finical system should be stimulated and maintained by the effective activities of an efficient capital market, which is the head of the “Stock Exchange”.

The stock exchange therefore is the market where companies, raise capital on a short term and long term basis. This role of mobilization and allocation of funds to every sector of the economy which made it (Stock Exchange), the toast of investors has given it a pride of plan in every economy. There is no doubt, that the success or failure of every sector in the economy rests to every large extent on its stock exchange market. This is because for any sector in the economy to grow an efficient means of capital formation must not be ignored considering the importance of capital in any organization setting.

Since the establishment of the Nigerian stock exchange (NSE) some forty two years back (42) elements of stagnation, dormancy and unproductiveness in the economy is being experienced despite the tremendous development in the exchange systems. This situation has taken a worrisome dimension in which many questions are being raised on the relevance of the Nigerian stock exchange in facilitating investments in the Nigerian economy.

 

1.1     AN OVERVIEW OF THE BACKGROUND OF THE STUDY

There was no organized financial market or institution in Nigeria prior to the establishment of the central bank of Nigeria (CBN) by the Act of parliament in 1958. Consequently, surplus funds of the financial system were invested abroad there by starving the economy of the mush – needed capital for general development. But immediately the central bank of Nigeria came into existence, the banks started pioneering the development of Nigerian financial market comprising the money market for short-term funds.

The development of the Nigerian money market for short term funds started in 1960 with the issue of the first Central Bank of Nigeria Treasury Bills. Subsequently, other short-term debt instruments such as Treasury certificates, commercial Bills, certificate of Deposits e.t.c were introduced by Central Bank to increase the volume and depth of the money market.

 

The first attempt of developing the Nigeria capital market can be traced to the year 1959, when the Central Bank of Nigeria floated the First Nigerian Development loan stock on behalf of the Federal Government of Nigeria. The capital market was divided into two (2) categories. The primary market which deals in new issues and the secondary market which deals in old securities, all in the stock exchange. In Nigeria, capital market is regarded as the stock exchange because of the integral part it plays in the stock exchange market. It is involved in many financial activities around which all othe