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Stakeholders link persistent lull to delayed economic agenda

By Helen Oji
01 November 2019   |   3:18 am
Capital market stakeholders have linked the persistent lull in the nation’s bourse to delay by the new Presidential Economic Advisory Council (PEAC), to implement economic roadmap since the October 9th inauguration.

capital market. Photo: PEXELS

• Stock market close October upbeat as index rises 0.17 per cent

Capital market stakeholders have linked the persistent lull in the nation’s bourse to delay by the new Presidential Economic Advisory Council (PEAC), to implement economic roadmap since the October 9th inauguration.
They urged the economic advisory team to urgently review their agenda in line with their mandate, to revive the economy, restore investor’s confidence, and turnaround the market.
Reacting to the increasing apathy in the market, and the overall economy, they argued that the negative trend may persist if government failed to implement fiscal and monetary reforms needed to stimulate economic growth and productivity

The PEAC, by Prof. Doyin Salami, replaced the Economic Management Team (EMT), headed by Vice President, Prof Yemi Osinbajo. Its functions include fiscal analysis, economic growth, and a range of internal and global economic issues, among others.
The investors argued that the prevailing low confidence has continued to hampered liquidity and influence trading negatively, irrespective of the ongoing earnings season.
The Chief Operating Officer, InvestData Ltd. said it is taking too long for the Economic Council to provide the needed guidelines or economic roadmap that would kick-start activities in Nigeria.
Omordion maintained that the uncoordinated fiscal and monetary policies have kept many foreign and domestic investors on the sideline.
He tasked the PEAC to come up with policies that will encourage and attract investors to the market and the economy in general, saying that incentives such as reduced cost of transaction and tax holidays to boost new listing at the Nigerian Stock Exchange  (NSE).
He suggested that the listings requirements should be made more flexible to attract new companies to the Stock Exchange.
Also speaking, the Publicity Secretary, Independent Shareholders Association, Moses Igbrude, said the Nigerian capital market has failed to play the role of key economic driver, calling for urgent policies to revive the economy and bolster the market.
He linked the continuous bearish trend in the market to domestic economic hardship affecting production and consumption, noting that investors must have confidence in the economy for things to turnaround.
Meanwhile, the Nigerian equities market gained 0.17 per cent amid bargain-hunting activities to close the trading for the month of October in an upbeat
Specifically, the All Share Index (ASI), rose by 44.58 points or 0.17 per cent to 26,355.35 points. Accordingly, investors gained N22 billion in value as market capitalisation edged to N12.830 trillion.

The upturn was impacted by gains recorded in medium and large capitalised stocks, amongst which were; Seplat Petroleum Development Company (Seplat), Nigerian Breweries, Dangote Cement, Flour Mills of Nigeria, and University Press (UPL).

Analysts at Afrinvest Limited, said: “Although, we have seen slight gains in the equities market recently, we do not expect this to be sustained as investors’ maintain a risk-off approach.”
Market breadth closed positive as 18 stocks posted gains while 13 declined. Seplat recorded the highest price gain of 9.28 per cent to close at N565, while Chams followed with 9.09 per cent to close at 24 kobo, per share.
Jaiz Bank rose 8.89 per cent to close at 49 kobo, and Consolidated Hallmark Insurance and Nigerian Breweries gained 8.11 per cent each, to close at 40 kobo, and N50, respectively, per share.     
On the other hand, Unity Bank led the losers’ chart with 8.47 per cent to close at 54 kobo per share.
Law Union and Rock Insurance followed with 8.16 per cent to close at 45 kobo, while Union Diagnostic and Clinical Services was down eight per cent to close at 23 kobo, per share.
Oando lost 7.44 per cent to close at N3.11, while Guaranty Trust Bank shed 2.35 per cent to close at N24.90, per share.
The total volume traded rose by 148.23 per cent to 347.797 million shares worth N6.79 billion, traded in 2,756 deals. Transactions in the shares of Zenith Bank topped the activity chart with 103.69 million shares valued at N1.77 billion.
FCMB Groups followed with 85.12 million shares worth N136.57 million, while Guaranty Trust Bank traded 39.18 million shares at N980.52 million.
United Bank for Africa (UBA) traded 21.66 million shares valued at N125.59 million, while MTN Nigeria transacted 21.25 million shares worth N2.68 billion.