NAN-HE-4
Funds
By Chinyere Joel-Nwokeoma
Lagos, Oct. 31, 2016 (NAN) Some financial experts on Monday advised the Federal Government to release more capital projects fund to the employment generating sectors to boost the nation’s economic activities.
They gave the advice in separate interviews with the News Agency of Nigeria (NAN) in Lagos on the government’s pronouncement that N720 billion had been released for capital projects.
In his comments, Dr Uche Uwaleke, Head of Banking and Finance Department, Nasarawa State University, Keffi, said that deployment of more capital projects funds to employment generation sectors would increase employment rate.
The expert said that the amount so far released for the capital projects had not impacted on the economy due to recession.
He said that about 50 per cent of the 2016 capital budget which government claimed it has already expended has little or no impact on the stock market.
“This is because the amount so far spent is insufficient to get the economy out of recession.
“Unemployment and inflation rates have not come down and people naturally have to take care of their basic needs before investing in stocks,” Uwaleke said.
He said that the implementation of social intervention schemes should commence in earnest to reduce unemployment rate.
The expert explained that uncertainties in the monetary and fiscal policies contributed to low investment confidence in the nation’s bourse.
“The present economic recession has compounded the liquidity challenge in the stock market.
“So, you find investors selling their shares whenever there is an appreciation in value to make some profit or even cut down on losses,” he added.
Uwaleke said that the market would witness mixed performance this week, noting that profit taking would most likely erode any bullish sentiment on the back of improved companies’ fundamentals.
Also, Mr Ambrose Omordion, the Chief Operating Officer, InvestData Ltd., attributed the development in the market to the general economic situation which made savings difficult.
Omordion said that many foreign and local investors were sitting on the sidelines due to lack of confidence.
He said lack of clear policies that could revamp the economy contributed to the trend in the market.
Omordion said that the investors’ failure to react to some positive earnings reports released in the market to weak fundamentals affected the demand for stocks.
NAN reports that a turnover of 678.71 million shares worth N6.88 billion were exchanged by investors in 11,808 deals last week compared with 674.72 million shares valued at N7.66 billion transacted in 12,290 deals in the preceding week.
The Financial Services Industry led the activity chart in turnover terms, accounting for 529.26 million shares worth N2.77 billion traded in 6,290 deals.
The Consumer Goods sector followed with a total of 58.41 million shares valued at N2.70 billion in 2,223 deals.
The third place was occupied by the Conglomerates industry with a turnover of 50.38 million shares worth N95.11 million achieved in 537 deals.
The All-Share Index during the period under review lost 302.61 points or 1.10 cent to close at 27,294.21 compared with 27,596.82 posted in the corresponding week due to price loses.
NAN reports that the decline further pushed the All-Share Index’s performance year-to-date to 4.71 per cent from the previous week’s position of 3.65 per cent.
Also, the market capitalisation which opened with N9.478 trillion lost N103 billion to close at N9.375 trillion.
Fidson Healthcare recorded the highest loss in percentage terms, shedding 16.45 per cent or 25k to close at N1.27 per share.
Ashaka Cement trailed with a loss of 9.65 per cent or N1.31 to close at N12.26, while Honeywell Flour lost 9.23 per cent or 12k to close at N1.18 per share.
On the other hand, Caverton led the gainers’ table for the week in percentage terms, growing by 27.91 per cent or 24k to close at N1.10 per share.
Lafarge Africa followed with a gain of 16.25 per cent or N6.99 to close at N50, while Total increased by 13.79 per cent or N39.99 to close at N329.99 per share. (NAN)
JNC/AOS/GOK
Edited by Bayo Sekoni/Olagoke Olatoye
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