Capital Market
Investors on the stock market have lost over N145 billion in three trading days of this week as the bearish trend continued.
Specifically, the Nigerian Stock Exchange, NSE, market capitalization which represents the value of investments on the exchange, declined to N20.7 trillion from N20.8 billion on Friday.
Similarly, another stock market gauge, the NSE All-Share Index, ASI dropped by 277.83 points to 39.5 22.06 points from 39,799.89 points representing a 0.7 percent decline.
Capital market operators have predicted that the stock market might not record the balloon gain this year as it was in 2019 following the increasing returns on fixed income instruments in recent time and the normalcy in economic activities following the availability of coronavirus, COVID-19 vaccines.
Meanwhile, activities in the market on Wednesday showed that in spite of the sign upward movement in SEPLAT Petroleum at 10 percent coupled with gains in PRESCO at 195 bases points bps, Guaranty Trust Bank 63 bps, and UBA 61bps, the domestic bourse maintained Tuesday’s bearish performance, shedding 44 bps to close at 39,522.06 points.
Reacting, analyst and Head of Investment, Fidelity Securities Limited, Victor Chiazor, said: “The increase across all the fixed income and money market instruments are continually sending a signal to the market that rates may be on their way up this year and this is expected to negatively impact the equities market. If this uptrend in rates persists, we may see most Pension Fund Administrators, PFA’s and other investors sell off their investments in equities and move their capital to the fixed income market.”