Impact of Investors' Sentiment and Gross Domestic Product on Stock Return in Nigeria

The objective of this study is to empirically establish the relationship between investors’ sentiment and Real Gross domestic product (RGDP) on stock return in Nigeria. The study is correlational in nature and used panel regression model to test the hypotheses. Using 10 listed firms as the sample size from 1st January 2008 to 31st December 2021 out of the 156 firms listed on the Nigerian stock exchange. The study found the presence of a positive and insignificant link between investor sentiment and stock return, also showed the presence of negative and statistically insignificant relationship between RGDP on stock returns. Consequently, the study recommended that, there is need for the policy makers and regulators of the Nigerian capital market to consider sentiment amongst investor as an indicator for price movement in the stock market. The central Bank of Nigeria should consistently implement economic growth policies which will increase both aggregate demand and supply to making the economy more productive which will positively affect the GDP. This will result in the rise in stock prices. These policies may be considered by the government: monetary policies (cutting interest rate), fiscal policy (cut taxes) increase money supply, privatization/deregulation and investment in education.