Pre- and Post-Fuel Subsidy Removal and Nigerian Exchange Group Perfomance
Ochuko Benedict Emudainohwo*
Oghenekparobo Ernest Agbogun
This study examined the mean value of measures of instruments of trade in pre-fuel subisidy removal (pre-FSR) (54 weeks: 20th May 2022 – 26th May 2023) and post-FSR (54 weeks: 2nd June 2023 – 7th June 2024) using the paired sample t-test. Also, the study employed Autoregressive Distributed Lag (ARDL) bounds regression to further examined how equity measures and exchange traded products measues influences market capitalization growth in both compared periods.Various preliminary analysis conducted to ensure that the model is well fitted include the Clemente-Montanes-Reyes single additive outliers (AO) test, Spearman rank correlation, Lag-order selection criteria, Auguemtned Dicker Fuller (ADF) and Philip Peron (PP) unit root, autocorrelation, Homoskedasticity, Norrmality and Ramsey Reset, and Parameter Stability test. The paired sample t-test reported that the mean difference of Equity shares total turnover (ESTT), Equity total shares worth (ESW), Equity deals (ED), Exchange traded products volume (ETPV), Exchange traded product worth (ETPW), and Exchange traded product deals (ETPD) were higher during post-FSR than during pre-FSR. Nevertheless, the coefficient of explanatory variables during pre-FSR nor post-FSR were significant to explain Market capitalization: growth (MCG) in both short and long-run. The paper concludes that though FSR is an important element in the larger scheme to accelerate Nigerian Exchange Group (NGX) performance, FSR has not significantly impacted NGX in spite having better mean difference. Consequetly, the Nigerian government should invest freed financial resources into infrastructural facilities that will better the productivities of listed companies. Also, the Nigerian government should revitalize the domestic refineries to refine crude oil.
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