Abstract: Financial markets worldwide play a crucial role in a country's economic and financial status. They facilitate governments and companies in raising funds for development and investments through diverse financial instruments, such as securities, derivatives, and bonds, which offer profit opportunities to investors. This study's primary objective was to examine the factors influencing the financial performance of the Nairobi Securities Exchange, the main financial market in Kenya, during general elections. The factors considered were interest rates, cash flow volatility, and inflation. The research targeted 20 stockbrokers, 20 investors, and 10 NSE junior employees, using a stratified sampling method to gather both primary and secondary data. Quantitative and qualitative techniques were employed to analyze the primary data, presented through narratives, tables, and graphs. Secondary data was sourced from journals and the stock exchange database. Descriptive and inferential statistics were utilized to determine how the independent variables affected the dependent variable. The study findings revealed that inflation and cash flow volatility significantly impacted share prices and influenced the stock market. General elections led to inflation, affecting the stock exchange with considerable volatility spikes around Election Day. Affordable share prices attracted foreign investors who played a role in determining share prices. High-interest rates resulted in higher share pricing, while lower interest rates led to lower share pricing, subsequently influencing trading activity and the market's overall performance.
Keywords: inflation, cashflow volatility, interest rates, macroeconomic, financial performance.
Title: Effect of Macro-economic Factors on the Financial Performance of the Nairobi Securities Exchange during General Elections in Kenya
Author: Mbatiah M. John
International Journal of Social Science and Humanities Research
ISSN 2348-3156 (Print), ISSN 2348-3164 (online)
Vol. 11, Issue 3, July 2023 - September 2023
Page No: 42-49
Research Publish Journals
Website: www.researchpublish.com
Published Date: 27-July-2023
