country
$20 Bonus + 25% OFF
Securing Higher Grades Costing Your Pocket? Book Your Assignment at The Lowest Price Now!

Question:

Discuss about the Oil Prices and Stock Markets.
 
 

Answer:

Background

Oil prices and stock market are both identified as leading economic indicators. Contextually, it has been observed that oil prices have negative relation with the price increase and economic growth. Economic growth is considerably associated with trading. In stock market, public listed companies are able to trade in a systematic manner. According to the past scenarios, rises of oil prices have coincided with equity market, higher inflation, government bond yield and economic recessions. Based on the fluctuation of oil prices and instable economic condition, it can be highlighted that the movements of oil price and stock market both have a minimal correlation (Ready, 2016).

Aim

The aim of the research focuses on highlighting the potential effects of frequent changes in petroleum price over the past years along with corporate cash flows and earnings, which consequently have an impact on stock price.

Objectives

  • To investigate the impact of volatility spillovers
  •  To discuss the bidirectional impacts on petroleum prices and stock sector indices
  • To analyze the potential impacts of petroleum price on economy and stock price in North America, Western Europe and OPEC
 

Literature Review

Oil Price is one of the most prominent driving forces of world economy. In the last few decades, the energy dependency of the entire world has significantly changed. According to the changing scenario, the world has witnessed a stable growth with respect to energy resources, especially in petroleum. Considering the present market scenarios, it can be evaluated that petroleum along with different products are in high demand for the different varied world governments along with the stock markets (Husain, Arezki, Breuer, Haksar, Helbling, Medas…, & Sommer, 2015; Ramos & Veiga, 2014). Petroleum prices have been more volatile as compared to the other commodities. Difiglio (2014), analyzed 40 years of data related with oil price stocks and economic growth, thus revealed that weak economic growth is almost preceded by oil price stock. It is also observed that price-inelastic demand and supply of oil price shocks and reduction of economic growth are related with each other (Difiglio, 2014).

In the context of relatedness of different factors of stock market, economies and oil price, Xiong & Han (2015) presented that there is a potential “linkage between exchange rates and stock return series in terms of the conditional secondary moments of relevant distributions, which is also known as volatility spillovers” (p. 8). It is a significant factor in stock market and economy stability, which was critically portrayed from the research findings of Natarajan, Singh & Priya (2014). Natarajan et al. (2014), depicted that the volatility spillovers can identify two different angles for stock market operations and economies. It can be used to emphasize casual relationship within the current volatility and previous volatility shocks of a specific market. On the other hand, cross volatility spillovers indicates a one way relationship between current volatility of a market and past volatility of the other market (Natarajan et al., 2014).

 


According to the past scenarios, it has been observed that the oil prices declined in the year 2014, which can be explained by the increase of oil supply. The factors have notably portrayed that lower price of oil has weaker worldwide demand. Supply of petroleum oil can be affected due to investment and technological innovations, which facilitate the extractions of crude oil. Weaker global growth may be recognized as a main driver for the downfall in the oil prices (ECB Economic Bulletin, 2016). ECB Economic Bulletin (2016), also presented an approach of movements relating to the petroleum price, in the context of stock market volatility. The petroleum prices are allied with different channels, which may generate impacts on the return of stock markets. The fluctuation of petroleum price and the sudden shocks of stock prices may attract the attention of several associates including policy makers, investors, finance researchers and practitioners across the entire world. The major economic rationale has the potential effects of the frequent changes in corporate cash flows, earnings, stock prices. Moreover, Imarhiagbe (2010), stated that the long term relationship within ‘oil price-macroeconomic’ and ‘oil price-stock price’. Past evidences have significantly highlighted the correlation between oil price and the economic output, which directly influence the stock market operations. Correspondingly, the basic materials including financial, industrial sectors, oil and gas products’ prices are hampered due to the fluctuation in economic output and stock shocks. Contextually, this scenario thoroughly emphasized the bidirectional impacts associated with petroleum prices as well as stock sector indices that will be critically elaborated in final section of literature review in the dissertation.

 

Methodology

The study will select qualitative research method for the conducting further research. Contextually, it is observed that the qualitative method is able to focus on diversified areas of inquiry as well as reveals the trends of perceptions to evaluate the solution of the core problem. Moreover, qualitative research approach provides aids to reveal the behaviors of target audiences and their perceptions towards particular issue (Qualitative Research Consultants Association, 2017; Creswell, 2014). The study will also conduct secondary data collection process, through which it will able to gather information related with oil prices, stock market and global economies. For secondary data collection, the study will consider previous researches of different scholars, industrial reports along with past records on economic growth, oil price fluctuation and stock market. Qualitative research will be most appropriate for this study due to the in-depth analysis of the process (University of Southern California, 2017). The study will consider secondary resources, which will enable in providing numerical related with oil price, world economies and stock market fluctuation along with their relationships for generating impacts on each other.

Data exclusion and inclusion procedure will follow be throughout the research process for maintaining the feasibility and reliability of the study. The research strategy will also follow the most feasible way of literature search strategy to conclude a reliable outcome at the end of the study. First the research will avail search engine such as Google, Google scholars to gather resources associated with oil price fluctuation, stock market and global economies’ influential factors and driving forces along with past records on price fluctuations. From secondary resources, the study will focus on gathering stock market trends and its impacts on global economies. The fluctuation of oil prices and its relation with stock market as well as the combined impacts on global economies will also be covered through the secondary data.

Ethical consideration is relied on the moral principles of specific conductions. The study will follow the comprehensiveness, reliability and feasibility in the overall process to maintain the accurate outcome. The study will also follow the ethical consideration norms and industrial legal approval details for achieving optimal reliability. The trustworthy resources will only utilize for maintaining the credibility, transferability and conformability of outcome. The article will utilize audit trail to record information in details, including flexible data context and describe appropriate data collection procedures as well (Houghton, Casey, Shaw & Murphy, 2013). On the other hand, the entire process will significantly follow the norms of confidentiality, thereby evading the chances of biasness.

Data Analysis

Data analysis is an important part through which further findings and results will be identified. For a compact data analysis, the study will focus on following the thematic analysis process. Thematic analysis is one of the most common and radical forms of data analysis that can use in qualitative research approach. It is able to emphasize and examine the gathered data on the basis of themes. The pattern of themes will follow all data sets and will be segregated according to the description of a specific phenomenon. In thematic analysis, the study will describe different themes and will attempt to explain the predefined themes on the basis of aforementioned research aim and objectives. In thematic analysis, the study will further gather data based on certain themes, which will be distinctly associated with oil price, stock market and their interrelationship along with its combined impacts on global economies. These scenarios will help to understand the alignment of the projected aim and will help to achieve the objectives as well.

 

Conclusion

The study will depict regarding the significance of oil price fluctuations and its impact on global economies along with the stock market. The scenario will be explained with the support of secondary researches from industrial reports and previous recorded data, which are related with oil prices, stock market fluctuation and economies’ dependency. Reliable data will help in portraying the highlighted issues of the study and assist in concluding significant result. Contextually, the study will also focus on evaluating the specific aim and the objectives through which further elaborations of dissertation will be conducted.

Dissertation Structure

Introduction

Initial idea regarding the research’s aim and objectives, which will help to conclude a feasible outcome of the identified issue

Literature Review

Scholarly articles, industrial reports and previous records will be segregated and discussed accordingly

Methodology

The process of research conduction will describe accordingly through appropriate data collection method, research method, analysis method and ethical consideration

Data Analysis and Discussion

Analysis of gathered data will be conducted and discussed for generating an in-depth understanding regarding the issue

Result and findings

With the support of secondary data, the study will draw a comprehensive finding, which will help to conclude results

Conclusion

The overall findings and understanding will draw in this section

Time Line

The following Gantt chart provides an idea regarding the time span of research conduction and its different segments:

Gantt chart

Figure 1: Gantt Chart

 

References

Creswell, J. W. (2014). Research design: Qualitative, quantitative, and mixed methods approaches. US: SAGE.

Difiglio, C. (2014). Oil, economic growth and strategic petroleum stocks. Energy Strategy Reviews, 5, 48-58.

ECB Economic Bulletin. (2016). Global implications of low oil prices. ECB Economic Bulletin, 4, 1-4.

Houghton, C., Casey, D., Shaw, D. & Murphy, K. (2013). Rigour in qualitative case-study research. Nurse Res, 20(4), 12-17.

Husain, A. M., Arezki, R., Breuer, P., Haksar, V., Helbling, T., Medas, P. A…, & Sommer, M. (2015). Global implications of lower oil prices. US: International Monetary Fund.

Imarhiagbe, S. (2010). Impact of oil prices on stock markets: Empirical evidence from selected major oil producing and consuming countries. Global Journal of Finance and Banking Issues, 4(4), 15-24.

Natarajan, V. K., Singh, A. R. R. & Priya, N. C. (2014). Examining mean-volatility spillovers across national stock markets. Journal of Economics Finance and Administrative Science, 19(36), 55-62.

Qualitative Research Consultants Association. (2017). Why qualitative research works?. Retrieved September 15, 2017, from https://www.qrca.org/?page=whatisqualresearch

Ramos, S. & Veiga, H. (2014). The interrelationship between financial and energy markets. Germany: Springer.

Ready, R.C. (2016). Introduction. Oil Prices and the Stock Market, 2-36.

University of Southern California (2017). Organizing your social sciences research paper: Qualitative methods. USC Libraries. Retrieved September 15, 2017, from https://libguides.usc.edu/writingguide/qualitative

Xiong, Z. & Han, L. (2015). Volatility spillover effect between financial markets: Evidence since the reform of the RMB exchange rate mechanism. Financial Innovation, 1(9), 2-12.

OR

Cite This Work

To export a reference to this article please select a referencing stye below:

My Assignment Help. (2019). Oil Prices And Stock Markets. Retrieved from https://myassignmenthelp.com/free-samples/oil-prices-and-stock-markets.

"Oil Prices And Stock Markets." My Assignment Help, 2019, https://myassignmenthelp.com/free-samples/oil-prices-and-stock-markets.

My Assignment Help (2019) Oil Prices And Stock Markets [Online]. Available from: https://myassignmenthelp.com/free-samples/oil-prices-and-stock-markets
[Accessed 25 May 2020].

My Assignment Help. 'Oil Prices And Stock Markets' (My Assignment Help, 2019) <https://myassignmenthelp.com/free-samples/oil-prices-and-stock-markets> accessed 25 May 2020.

My Assignment Help. Oil Prices And Stock Markets [Internet]. My Assignment Help. 2019 [cited 25 May 2020]. Available from: https://myassignmenthelp.com/free-samples/oil-prices-and-stock-markets.


For years now, MyAssignmenthelp.com is providing affordable essay help to millions of students worldwide. Our essay assistance services have helped us in assisting students with even the toughest essay assignments. We take pride in the fact that we cater the best assistance to search terms like help me with my essay. We offer affordable services in the fastest way possible. For our fast delivering services, students trust us with their urgent essay assignment needs. Two of our most popular essay writing services are maths essay help and English essay help.

Latest Finance Samples

HI5002: Finance For Business Research

Download : 0 | Pages : 9

Answer: Introduction: Woolworths Limited is regarded as one of the major Australian organization having extensive amount of retail interest across the regions of Australia and New Zealand. Woolworths Limited is regarded as the second largest company in Australia following the Perth Based retail company of conglomerate Wesfarmers. In addition to this, Woolworths Limited is regarded as the largest takeaway retailer of liquor in Australia with l...

Read More arrow Tags: Australia Brisbane Management Explain sociologically how social inequality (in terms of class and/or ethnicity) is constructed and James Coo 

ACST201 Financial Modelling

Download : 0 | Page : 1
  • Course Code: ACST201
  • University: Macquarie University
  • Country: Australia

Answer: Part A: Calcualtion of Implied annual nominal rate Annual Borrowing 100000 Number of payment 60 Monthly Payment 2000 Compounding Periods per year 12 Total Duration of Loan 5 Interest Rate 7%   Goal = Monthly Repayment to 2000   Annual Borrowing 100000 Number of payment 59 Compounding Periods per year 12 Interest Rate 7% Monthly Payment 200...

Read More arrow Tags: Australia Melbourne Finance Accounting University of Melbourne Management 

IC51002A Perspectives On Capital: Financial, Physical, Human And Social System

Download : 0 | Pages : 8
  • Course Code: IC51002A
  • University: Victoria University
  • Country: Australia

Ansqwer: Introduction: Social Capital is easily understandable as the web of the social relations which are distinguished by the norms of trust and the reciprocity. The basic core of the social capital is only the relations that humans maintain with people. The quality of the relations is understood with the help of social capital when people come together to resolve the issues they face commonly and in the end they gain mutual benefit from t...

Read More arrow

FELM4026 Financial And Economic Literacy For Managers

Download : 0 | Pages : 17

Answer: Introduction: The report has been prepared to evaluate the various concepts of business economics in UK market. For this analysis, various articles, economic report and the newspapers have been read so that a conclusion could be made about the business performance and the economic factors of the country.  Firstly, UK local high street store has been researched and it has been found that how the market is performing and one of the...

Read More arrow Tags: Australia Lewisham Management University of New South Wales Humanities 

FINA6000 Managing Finance 3

Download : 1 | Pages : 2
  • Course Code: FINA 6000
  • University: Laureate International Universities
  • Country: United States

Answer: Suggestions: According to the calculations, few suggestions have been given to the investors about the investment in the company and the basis which are required to be evaluated while investing into the stock: a) Basis for selection of a stock: An investor should select a stock after investigating and evaluating the various factors of the stock such as total risk, total return, performance of the security etc. If the risk and return o...

Read More arrow
Next
watch

Save Time & improve Grade

Just share Requriment and get customize Solution.

question
We will use e-mail only for:

arrow Communication regarding your orders

arrow To send you invoices, and other billing info

arrow To provide you with information of offers and other benefits

1,317,480

Orders

4.9/5

Overall Rating

5,074

Experts

Our Amazing Features

delivery

On Time Delivery

Our writers make sure that all orders are submitted, prior to the deadline.

work

Plagiarism Free Work

Using reliable plagiarism detection software, Turnitin.com.We only provide customized 100 percent original papers.

time

24 X 7 Live Help

Feel free to contact our assignment writing services any time via phone, email or live chat.

subject

Services For All Subjects

Our writers can provide you professional writing assistance on any subject at any level.

price

Best Price Guarantee

Our best price guarantee ensures that the features we offer cannot be matched by any of the competitors.

Our Experts

Assignment writing guide
student rating student rating student rating student rating student rating 4/5

1309 Order Completed

100% Response Time

Gemmie Chen

MSc in Nursing

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 4/5

248 Order Completed

100% Response Time

Lloyd Bernabe

MSc in Accounting

London, United Kingdom

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

2109 Order Completed

99% Response Time

Emma Zhong

Ph.D in Project Management with Specialization in Project Communications Management

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

234 Order Completed

100% Response Time

Samantha Ji

PhD in Chemistry with Specialization in Organic

Singapore, Singapore

Hire Me

FREE Tools

plagiarism

Plagiarism Checker

Get all your documents checked for plagiarism or duplicacy with us.

essay

Essay Typer

Get different kinds of essays typed in minutes with clicks.

edit

GPA Calculator

Calculate your semester grades and cumulative GPa with our GPA Calculator.

referencing

Chemical Equation Balancer

Balance any chemical equation in minutes just by entering the formula.

calculator

Word Counter & Page Calculator

Calculate the number of words and number of pages of all your academic documents.

Refer Just 5 Friends to Earn More than $2000

Check your estimated earning as per your ability

1

1

1

Your Approx Earning

Live Review

Our Mission Client Satisfaction

The finished product of my assignment was impressive! No stone was left unturned from the required rubric. Easy to follow, original material, and thorough, not to mention, completed more than 24hrs before the requested time. THANKS TO MY MAH EXPERT! ...

flag

User Id: 383727 - 25 May 2020

Australia

student rating student rating student rating student rating student rating

THANKS Very timely completion. The attitude of the experts is very good, and it is found that the job requirements are different at different times. The experts completed the new requirements in a short time.

flag

User Id: 419166 - 25 May 2020

Australia

student rating student rating student rating student rating student rating

thanks for helpingto get good marks in all the work. i have got good marks. i hope u will provide good work in future

flag

User Id: 365675 - 25 May 2020

Australia

student rating student rating student rating student rating student rating

Met the requirements for the assignment. I would definitely recommend this website.

flag

User Id: 278516 - 25 May 2020

Australia

student rating student rating student rating student rating student rating
callback request mobile
Have any Query?