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Evaluating Microeconomic Factors, Financial Crisis, and Stock Price Dynamics: Evidence From MENA Region

Evaluating Microeconomic Factors, Financial Crisis, and Stock Price Dynamics: Evidence From MENA Region

Husam-Aldin N. Al-Malkawi, Rekha Pillai, Mohammad S. AlShiab
Copyright: © 2020 |Pages: 23
ISBN13: 9781799821366|ISBN10: 1799821366|EISBN13: 9781799821373
DOI: 10.4018/978-1-7998-2136-6.ch007
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MLA

Al-Malkawi, Husam-Aldin N., et al. "Evaluating Microeconomic Factors, Financial Crisis, and Stock Price Dynamics: Evidence From MENA Region." Handbook of Research on Accounting and Financial Studies, edited by Luís Farinha, et al., IGI Global, 2020, pp. 131-153. https://doi.org/10.4018/978-1-7998-2136-6.ch007

APA

Al-Malkawi, H. N., Pillai, R., & AlShiab, M. S. (2020). Evaluating Microeconomic Factors, Financial Crisis, and Stock Price Dynamics: Evidence From MENA Region. In L. Farinha, A. Cruz, & J. Sebastião (Eds.), Handbook of Research on Accounting and Financial Studies (pp. 131-153). IGI Global. https://doi.org/10.4018/978-1-7998-2136-6.ch007

Chicago

Al-Malkawi, Husam-Aldin N., Rekha Pillai, and Mohammad S. AlShiab. "Evaluating Microeconomic Factors, Financial Crisis, and Stock Price Dynamics: Evidence From MENA Region." In Handbook of Research on Accounting and Financial Studies, edited by Luís Farinha, Ana Baltazar Cruz, and João Renato Sebastião, 131-153. Hershey, PA: IGI Global, 2020. https://doi.org/10.4018/978-1-7998-2136-6.ch007

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Abstract

The purpose of this chapter is to examine the impact of microeconomic factors and the global financial crisis (GFC) on stock prices in the Middle East and North Africa (MENA) region. The study employs panel data techniques covering a sample of 277 firms listed in seven MENA countries for the period 2000-2015. The empirical model consists of eight microeconomic (firm-specific) variables and a dummy variable to capture the impact of global financial crisis. The results suggest that microeconomic factors play a vital role in determining stock prices in the MENA region. More specifically, factors such as return on equity, book value per share, dividend per share, earnings per share, and price-earnings ratio positively influence stock prices, while dividend yield and gearing have negative impact on stock prices. In addition, firm size posits a positive and statistically significant relationship with stock prices. However, the GFC seems to be insignificant determinant of stock prices in the case of MENA countries in the sample studied. This chapter provides several practical implications.

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