NAN-HE-5
Market
By Chinyere Joel-Nwokeoma
Lagos, Jan. 24, 2018 (NAN) Some financial experts on Wednesday expressed mixed reactions to the bullish trend witnessed by the Nigerian stock in
the past three weeks.
They told the News Agency of Nigeria (NAN) in Lagos, that the bullish trend could be achieved with increase in oil price and increased output.
Dr Uche Uwaleke, the Head of Banking and Finance Department, Nasarawa State University, Keffi, said that the bullish trend in the stock market
would be sustained, as long as crude oil price and output continue to rise.
Uwaleke said that the downside risks for the market remained the renewed threat of attack on oil facilities by Niger Delta militants.
He said that the delay in implementation of the 2018 budget was another factor that could affect market growth and development.
Uwaleke attributed the uptrend in the equities market, primarily driven by positive investors’ sentiments to the optimism concerning the Nigerian
economy.
He said that the International Monetary Fund (IMF) and the World Bank forecasts of real Gross Domestic Product (GDP) growth rate for Nigeria in
2018, at 2.1 and 2.5 per cent respectively, contributed to investors’ renewed interest in the market.
The lecturer said that another factor responsible for the remarkable year-to-date performance of stock market was the decline in money market
rates.
He said that the decline in money market rates made the equities market attractive to pension funds and other institutional investors.
Mr Bayo Adeleke, the immediate past Secretary, the Independent Shareholders Association of Nigeria, said that the market trend was not
sustainable.
Adeleke urged investors to invest with caution to avoid burning their hands.
“The trend is not sustainable. We are approaching an election year. Foreign investors will enter very cautious mode by third and fourth quarters
of the year,’’ he said.
NAN reports that the market capitalisation of the Nigerian Stock Exchange (NSE), which opened for the year at N13.609 trillion, rose by N2.55
trillion or 18.70 per cent, to close trading on Jan. 19 at N16.154 trillion.
Also, the All-Share Index, which opened for the year at 38,243.19, inched 6,849.64 points or 18 per cent, to close trading on Jan. 19 at
45,092.83. (NAN)
JNC/FLP/EEE
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Edited by Folorunso Poroye/Ese E. Ekama