ABSTRACT

A stock market is seen as a market for medium and long-

term funds. The primary purpose of the stock market is to

efficiently transfer funds between lenders and borrowers. In

many economies, the efficient allocation of capital resources

is vital for economic growth.

Thus, this work aims at investigating the extent to which the

Nigerian Stock Market has grown over the years and the

extent it has contributed to the overall growth of the

Nigerian economy. To achieve this, we employed the

multiple regression analysis, using E-view econometric

package to estimate the models.

In order to effectively appraise the growth and performance

of the Nigeria stock market, efficient market indicators such

as market capitalization, market turnover, All-share index,

daily volume traded, growth in the value of public new

issues, etc, are used as a yard stick.

Our empirical findings shows that the stock market is liquid

and its liquidity is positively and significantly influenced by

the market capitalization the market turnover, and the All-

share index. Hence this study proves that the growth and

performance of the Nigerian Stock Market is quite

impressive and will improve more in the near future.

Against the findings of this study, we recommend that; there

should be a free market where the forces of demand and

supply are allowed to determine the prices of securities.

However, the authorities of the market should be concerned

with administering the procedures for buying and selling of

securities so that more investors will be encouraged to enter

the market knowing fully well that the securities will be

appropriately priced.

Finally, the Nigerian Stock Exchange Should ensure

adequate information standards and information flows,

including the availability of up to date and timely data and

ease in the retrieval of information for decision making

potential investors, operators and investing pubic.