Impact Of Global Financial Crisis On Crude Oil Prices, Stock Prices And Inflation Rates In Nigeria

CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
SUMMARY
Chapter one saw us introducing the concept of global financial crisis. Attempts are made to give a background of global financial crisis, viz a viz the Nigeria situation. Nigeria is a part and parcel of the committee of nations low vulnerable. It was observed that Nigeria economy to global financial crisis and what have been the effects of the inflation, the magnitude and trend on the various sectors.
Also, the objectives for this research work were also spelt out together with its significance. Definition of global financial crisis within the context of this research work was done in chapter two
The research design and methodology were enunciated in chapter three. This created a framework for this study. Multiple research designs comprising both exploratory researches, which would provide background information, clarify problems raised by this thesis and hypothesis as well as establishing the research objectives. A descriptive research which will provide answers to the statements of problems.
Secondary  data  were  used  extensively  for  this  research  work. Data from various credible sources such as the Central Bank of Nigeria (CBN), Zenith Securities limited, monthly oil market report, Opec Bulletin, Cash craft Asset management limited were source of the data.
Data were presented using both tabular formats and line  graphs. Gathered data were subjected to statistical analysis. The expected regression estimates were also defined. The believed relationship between dependent variables and independent variable were clearly stated.
Data were analyzed using Regression Analysis. Results derived were interpreted under the following headings. The use of computer packages such as SPSS and STATGRAPHICS was evolved.
i. Stocks prices (Before and during the crisis)
ii. Crude oil prices (Before and during the crisis)
iii. Inflation rates (Before and during the crisis)
5.2 FINDINGS
It has been observed and established that the financial crisis has brought financial stresses, losses, bankruptcies, inflation. It was also observed that the current crisis was caused by the political leaders who facilitated the global economic crisis, Roubini (2009) surrendering to the “logic” of the unregulated market place and stated that US had broken from a fiscal stand point.
It was not observed that this is a situation which indicates systematic failure of the conventional banking system as echoed in Joseph Stiglitz’s comment that financial system has failed its crucial responsibilities of managing risk and allocating capital requiring inevitable change in its regulatory structures.
5.2.1 The Banking Sector
Statistical evidence shows the following findings:
The following bank stock prices were analyzed, First Bank, Intercontinental Bank, UBA and Zenith Bank. The models shows that before the crisis, Zenith share were decreasing at N 0.96 per month, but during the crisis the decrease was N 3.605 per month, when both periods were put together, the rate of decrease was N 1.996 per month. This shows that the crisis had great impact  on  the  stock prices.
In the case of UBA, it was also observed that the models show that the stock for UBA was decreasing by N 0.393 per month before the crisis.
But during the crisis, the rate of decreasing was N 3.852 per month. This now show the growth rate of N 102.517. This also confirms that the crisis had impact on UBA stock prices.
It is pertinent to note that the crisis really affected Intercontinental bank. The rate of the growth was N 2.673 increases in share prices per month before the crisis but during the crisis, the stock of the bank decreased  significantly  by  N  3.67  point  per  month.  When  the  two periods   were   put   together,   a   monthly   decrease   of   N   0.943   was observed.
Working at First bank, before the crisis, First bank was observing a slow growth rate of N 0.256 per month in the share prices during the crises. The bank observed a significant decrease of N2.874 per month. Thus, Fist bank performed badly in terms of share prices during the crisis. The general model reveal that as at present, First Bank share prices is still decreasing at N1.485 per month.
5.2.2 AUTOMOBILE AND TYRE’S SECTOR
RTBRISCOE was picked in this sector, a major automobile dealer in Nigeria. The three models were fitted for it, and it was observed that RT Briscoe was doing well before the crisis with an increase of 0.267 per month in their share prices. The crisis turned this increase to a decrease of N1.188 per month. This in general put RTBriscoe  at decreased rate of N0.912 per month.
5.2.3 CHEMICAL AND PAINTS SECTOR
In this sector, we looked at Berger paint one of the leading paints in Nigeria and observed that before this crisis, there was an increase in
share  prices  share  of  N1.505  per  month  in  their  share  prices  but during the crisis, there was a significant decrease in share prices of N-0.815 per month. Generally speaking, their share prices of Berger paints experience a non significant increase in share prices of N0.03092 per month.
5.2.4 CONGLOMERATES SECTOR
The impact of the crisis was also noticed in this sector, there was an increase in share prices of N0.789 per month but during the  crisis periods, a decrease in share prices of N1.872 was observed. This made the price of stocks for Unilever to have a decrease in share prices of N-0.503 per month over the studied period.
5.2.5. CONSTRUCTION SECTOR
Julius Berger was selected under this sector; it was also observed an increase before the crisis and share prices depreciated significantly at a monthly decrease in share prices of N7.995. It was shown that they are experiencing a price decrease in share prices of N1.115 per month.
5.2.6 FOOD BEVERAGES AND TOBACCO SECTOR
In this sector, Cadbury Nigeria Limited was selected. The models observed the increase in share prices of N1.633 per month before the crisis started. During the crisis, there was low monthly decrease in share price of N2.542 which generally put the company low at a monthly decrease in share prices of N0.936.
5.2.7 HEALTH CARE SECTOR
In health care sector, GlaxoSmith was selected for study the company recording a monthly price increase in share prices of N 0.924 but the crisis made it to have a monthly decrease  in  share  price  of  N1.052 which generally presently put a monthly decrease of N0.255.