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The Relationship Between the Energy Market, Economic Growth, and Stock Market Performance: A Case Study of COMESA

Author

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  • Chukwuemelie Chukwubuikem Okpezune

    (Economics Department, Faculty of Economics and Administrative Science, Near East University, TRNC, 99138 Nicosia, Cyprus)

  • Mehdi Seraj

    (Economics Department, Faculty of Economics and Administrative Science, Near East University, TRNC, 99138 Nicosia, Cyprus)

  • Hüseyin Özdeşer

    (Economics Department, Faculty of Economics and Administrative Science, Near East University, TRNC, 99138 Nicosia, Cyprus)

Abstract

This study examines the relationship between energy use, economic growth, and stock market performance in the COMESA region. It utilizes yearly data from 1990 to 2022, sourced from the World Bank. It applies the Method of Moments Quantile Regression (MMQR), a statistical technique that captures how relationships vary across different levels of stock market development. The analysis examines how fossil fuels, renewable energy, and energy imports impact stock market size (market capitalization) at varying levels of performance. The results indicate that both the use of fossil fuels and renewable energy have a significant impact on stock markets, although the effects vary. Renewable energy has the most important positive effect in countries with smaller or weaker markets, suggesting it can help strengthen financial systems in developing economies. However, its impact becomes weaker in stronger markets, possibly due to the costs and challenges of switching to clean energy. On the other hand, economic growth does not always lead to stock market growth, likely due to structural problems in the region that prevent economic progress from boosting financial markets. This study shows how energy policy, economic growth, and market performance are closely linked. It calls for targeted policies to support the shift to renewable energy, manage short-term challenges, and build strong infrastructure to support long-term growth and financial stability. This research helps explain how energy and economic factors shape stock market outcomes in COMESA, offering helpful guidance for investors, researchers, and policymakers aiming for sustainable development.

Suggested Citation

  • Chukwuemelie Chukwubuikem Okpezune & Mehdi Seraj & Hüseyin Özdeşer, 2025. "The Relationship Between the Energy Market, Economic Growth, and Stock Market Performance: A Case Study of COMESA," Energies, MDPI, vol. 18(16), pages 1-24, August.
    • Handle: RePEc:gam:jeners:v:18:y:2025:i:16:p:4341-:d:1724672
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