European Journal of Business and Management ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4, No.8, 2012
Factors affecting Stock Market Prices in Amman Stock Exchange: A Survey Study Sattam Allahawiah* Sameer Al Amro Albalqa Applied University, PO box 3, althanya -karak, Jordan * E-mail of the corresponding author: Sattam.firstname.lastname@example.org Abstract This study aims to identify the impact of most basic factors in the market share price of listed companies in Amman Stock Exchange from the respondent's opinions. These factors are: Internal factors and external factors. The population of the study included the (227) listed companies in Amman Stock Exchange. A random sample that of 60 companies was withdrawn. The study adopted descriptive and analytical method. To achieve the objectives of this study the researchers depended on two types of data: Secondary data and Primary data. For the purpose of testing hypotheses the study relied on statistical package for Social Sciences (SPSS) by using appropriate statistical methods. These are: Descriptive Statistic measures and ANOVA analysis test. Results of the study showed that there are impacts of internal and external factors in determining the stock prices of the listed companies in Amman Stock Exchange. The most impact was the inflation rate, while the least one was the nature of firm business. According to the objectives and results of the study, researcher recommended a several recommendations such as, strengthening the role of companies through their involvement in the drafting of laws and legislations Keywords: stock , market price, stock exchange, bonds market 1. Introduction: Amman Financial Market is considered one of the emerging markets, which was established in 1976. It started its operations on January 1st, 1978 and was run by aboard comprised of the public and private sectors. Amman Financial Market suffers from many weaknesses such as: economical, legal, political and social conditions. The market management issued many regulations to improve the market performance and to solve the problems and stresses that face the market. According to the Jordanian securities law no- 23 of 1997, three institutions were established: the Jordanian Securities Commission (JSC), the Securities Depository Centre (SDC), and Amman Stock Exchange (ASE). ASE was established in March 1999 as a non profit privately run institution, with legal and financial autonomy. ASE general assembly comprised of financial brokers who trade for their own accounts and any other entities JSC Board of Commissioners may identify. ASE is managed by a seven member board of directors four of whom are elected by the ASE General Assembly, and three appointed by the Board of Commissioners of the ASE. Most financial studies have mainly focused on the United States and European markets. Few studies have investigated developing and emerging markets. However this study seeked to determine the most important internal factors that affect the stock market prices for the listed firms in Amman Stock Exchange (ASE). Many factors can have an impact on stock market prices. This study examines the impact of some major internal factors on stock market prices for the listed firms in Amman Stock Exchange. These factors are 2. Problem statement Many individuals, firms, entrepreneurs, and governments invest large amounts of money into emerging financial markets. It is usually believed that the markets in developing and less developed countries are not efficient in strong and semi-strong forms. It is generally assumed that the emerging markets are less efficient than the developed market. The definition of emerging market highlights the growth potentiality as well as rapid growth of size of the market. However, it is possible that the market participants are not well informed and behave irrationally compared with well organized markets. The causes of lack of financial development, especially in capital markets, are...
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