Analysis the Determinants of Market Stock Price Movements: An Empirical Study of Jordanian Commercial Banks

Abstract

Financial firms make up a substantial fraction of the domestic equity market. A number of studies subsequently used different conceptual and methodological approaches to model equity return of financial services firms. Movement of the stock price as the consequence of the movement of the micro and macroeconomic factors is strongly supported by the literature review. Amman Stock Exchange in Jordan is inefficient in weak form. The sample of study includes the 14 commercial banks of Amman Stock Exchange for the period 2005 -2008. Simple and multiple regression analysis is conducted to find out the relationship microeconomic factors with the stock price and found highly positive significant relationship between market price of stock and net asset value per share; market price of stock dividend percentage, gross domestic product, and negative significant relationship on inflation and lending interest rate but not always significant on some years of Amman Stock Exchange in Jordan. [PUBLICATION ABSTRACT]