This study examined the effects of macroeconomic aggregate on retention ratio of selected quoted manufacturing firms in Nigeria for the period 1981 to 2014. The study used secondary data. The techniques adopted is the Ordinary Least Squares, Error correction mechanism and Autoregressive Distributed Lag (ARDL) Bounds approach to cointegration. The dynamic short run estimate revealed that interest rate exerts a negative influence on retention ratio. The study also found that oil price exerts a positive and significant impact on retention ratio. Further, it revealed that capital market development exerts a positive influence on retention ratio, but financial sector’s development showed a positive relationship with retention ratio, inflation rate appeared with expected negative sign. Foreign exchange rate showed a positive relationship with retention ratio; money supply exhibited a positive influence on retention ratio of quoted firms in Nigeria. The error correction coefficients were significant with the expected sign. Long run relationship among the variables were established. Thus, the study concludes that macroeconomic variables have significant influence on dividend policy. We recommend the need for firms to consider the operating macroeconomic framework in formulating dividend policy
Effect of Macro-economic factors on aggregate stock returns in the Tunisian financial market (Review Completed - Accepted)
The stock market returns are known to be significantly correlated with both inflation and money growth. Nevertheless, the impact of real macroeconomic variables on aggregate equity returns has been difficult to establish, perhaps, because their effects are neither linear nor time-invariant. Therefore, we estimate a GARCH model of daily equity returns in which the realized returns and their conditional volatility depend on twelve macro-series announcements. Hence, we perceive the absence of a significant relation between the macroeconomic announcement and the stock market returns. Moreover, the effect of the announcement of these variables has been tested on the returns. The obtained results show that the macroeconomic variables disclosed in the Tunisian financial market do not have any impact on the volatility of the returns of the shares quoted in the B.V.M.T.