Causal Nexus Between the Anomalies in the Crude Oil Price and Stock Market

International Journal of Energy Economics and Policy, 10 (3), 233-238, 2020

6 Pages Posted: 19 Mar 2020

See all articles by Iqbal Thonse Hawaldar

Iqbal Thonse Hawaldar

Kingdom University

Rajesha T.M.

affiliation not provided to SSRN

Lokesh Lokesh

affiliation not provided to SSRN

Adel Sarea

Ahlia University

Date Written: March 15, 2020

Abstract

The paper attempts to examine the causal association between the crude oil price anomalies and stock market returns in the Indian stock market. The study covers 9 years starting from 2009 to 2018, and the study includes ten companies in the oil drilling and exploration sectors listed in the BSE Sensex and CNX NIFTY indexes. We employed correlation tests in determining the relationships amongst the stock market return, crude oil price and market benchmarking indexes. Our study concludes that the oil price shocks is not directly affecting the stock prices of oil-related firms; instead, its indirectly impacting the economy through different channels such as fiscal, trade and price channels. We also suggest the need for future researches in determining the effect of oil price variations on the macroeconomic factors by precisely diagnosing the role of channels mentioned above.

Keywords: Oil Prices, Stock Market, Crude Oil Price, Emerging Markets, Indian Stock Market, Impact of oil price on Indian stock market

JEL Classification: G12, G15, Q43

Suggested Citation

Hawaldar, Iqbal Thonse and T.M., Rajesha and Lokesh, Lokesh and Sarea, Adel, Causal Nexus Between the Anomalies in the Crude Oil Price and Stock Market (March 15, 2020). International Journal of Energy Economics and Policy, 10 (3), 233-238, 2020, Available at SSRN: https://ssrn.com/abstract=3556135 or http://dx.doi.org/10.2139/ssrn.3556135

Iqbal Thonse Hawaldar (Contact Author)

Kingdom University ( email )

Sanad
Bahrain

Rajesha T.M.

affiliation not provided to SSRN

Lokesh Lokesh

affiliation not provided to SSRN

Adel Sarea

Ahlia University ( email )

P.O. Box 10878
Manama
Bahrain

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