Abstract: This study investigates the impact of macroeconomic variables and stock market development in Ghana. The frequency of the data is monthly starting from February 1998 to February 2013. The Persaran et al (2001) ARDL bounds testing cointegration approach confirms the long run relationship between considered variables. Results indicate that macroeconomic variables of foreign direct investment, gross domestic product, money supply and exchange rate have significant positive relationship with the stock market development in long run as well as in short run. The sensitivity analysis by dynamic ordinary least square (DOLS) confirmed the ARDL earlier results. It is also suggested that the economic growth and stable financials are better leading indicators of stock market development in Ghana. Consequently, policy makers should formulate policies for sustainable economic growth which can lead to development of Ghana stock exchange market. The policy implication is that resilient macroeconomic environment is a plus for stock market performance in Ghana.
Keywords: ARDL, macroeconomic variables, stock market development, cointegration, DOLS.
Title: Stock Market and Macroeconomic Performance in Ghana: New Evidence
Author: Isaac Cliford Queku, Emmanuel Carsamer
International Journal of Social Science and Humanities Research
ISSN 2348-3156 (Print), ISSN 2348-3164 (online)
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