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NSE CEO Unveils Measures to Improve Market Performance
Goddy Egene
The Chief Executive Officer of the Nigerian Stock Exchange (NSE), Mr. Oscar Onyema, will on Thursday unveil plans to reposition the exchange and the stock market in general for better performance in 2017.
Apart from unveiling plans to reposition the market, Onyema will also appraise the market performance in 2016. The market recorded its third consecutive decline in 2016. Specifically, the NSE declined by 6.17 per cent in 2016. Also, volume and value of trading dipped last year.
Investors staked had N557.75 billion on 78.90 billion shares in 2016, showing a decline of 41.33 per cent compared with N950.66 billion invested in 92.83 billion shares in 2015.
According to analysts at Meristem Securities Limited (MSL) said participation in the market was weak, as the volume traded and market turnover for the year pared by 15 per cent (78.90 billion units in 2016 vs 92.83 billion units in 2015) and 41.33 per cent (N557.75 billion in 2016 vs N950.66 billion in 2015) respectively.
The analysts explained that activities in the market was tempered during the year, as evidenced by the decline in volume traded and market turnover.
“We attribute this dull mood to weakened investors’ appetite given several headwinds that pervaded the different sectors of economy in the year. The weak investor sentiment was also compounded by the attractive interest rate environment in the year amid the rising inflationary pressure, which made fixed income investments a safe haven for investors,” they said.
Looking ahead, MSL said they expect a spill over of these sentiments into the first half of 2017.
“We expect a spill-over of these sentiments into the first half of 2017, on the back of sustained gloomy state of the economy, as FX pressure continues to plague companies. We, however, do not rule out the possibility of a positive return in 2017, as we expect the higher crude production and price stability, coupled with effective execution of 2017 budget, to bode well for the Nigerian economy in the coming year,” they said.
In their sectoral review, MSL said the agriculture sector led the outperformers. According to the firm, the Meri-Agri Index returned 26.45 per cent to outperform other sectors in the market for the second year consecutively.
“The sector’s positive performance was steered by the usual suspects- Okomu Oil Palm Plc (+32.57 per cent) and Presco Plc (+21.52 per cent), while Livestock Feeds Plc (36.84 per cent) depreciated in value for the year. Other counters (Ellah Lakes Plc and FTN Cocoa) traded flat throughout the year,” they said.
