Chinwendu Obienyi
Following the dwindling international oil market revenue, top securities dealers in Nigeria have urged the Federal Government to expand the agriculture sector to create job opportunities for youths and leverage commodities exchanges to grow the country’s foreign exchange earnings.
This was even as the dealers identified the need to put in place relevant structures that will enhance the growth of local industries, highlighting benefits of such exchanges. In a statement sent to Daily Sun, the Chairman, Association of Securities Dealing Houses of Nigeria (ASHON), Chief Onyenwechukwu Ezeagu, explained that the negative impacts of COVID-19 pandemic on most sectors of the economy has made it imperative for the government to enhance the growth and development of commodities exchanges as alternative source of revenue. He stated that the need to encourage the establishment and growth of the exchanges in Nigeria cannot be overemphasized in the wake of the crippling impact of oil glut and the COVID-19 pandemic. “If Nigeria is serious about diversification of its economy and increase forex earnings, the route to take is via functional commodities exchanges where all asset classes: agricultural, hydrocarbon and solid minerals are tradable in a most efficient and transparent manner and the quality of tradable commodities are guaranteed. This is even more so for local industries that need to be assured of regular and uninterrupted raw materials supply as their production input. The farmers, miners etc would benefit from an efficient commodities exchange platform as they have opportunity for price discovery and an assurance of off takers of their output”, Ezeagu said.
Also speaking, the Managing Director and Chief Executive Officer, Lagos Commodities and Futures Exchange, (LCFE), Akin Akeredolu– Ale, said it would soon commence trading on Agricultural Commodities, Solid Minerals, Currencies and Oil and Gas, to create a credible option for Nigeria’s accelerated economic revival and urged the government to put in place structures to promote agriculture and commodities exchanges.
Meanwhile, Nigeria’s stock market continued its bullish run following gains recorded in the shares of Zenith Bank, GT Bank and International Breweries which in turn drove the All Share Index 0.14 per cent higher on Wednesday. Despite prediction from analysts that the market would see some form of profit taking this week, investors took positions in some highly capitalised stocks to seal a N20 billion gain in two consecutive sessions after losing N35 billion on Monday.
Specifically, the ASI and market capitalisation settled to 25,171.32 points and N13.130 trillion while year-to-date (ytd) loss improved to -6.2 per cent. Across the market counters, 3 indices gained, 1 lost while the AFR-ICT and Oil & Gas indices were unchanged.
The Industrial Goods index was the lone loser as it dropped 0.04 per cent on account of sell-offs in CAP (-10.0 per cent). Conversely, the Banking index recorded the strongest gain, advancing 0.8 per cent due to buying interest in GT Bank (+2.1 per cent), Zenith Bank (+0.9 per cent) and UBA (+0.8 per cent). In the same vein, price appreciation in AIICO (+2.2 per cent) and International Breweries (+7.1 per cent) lifted the Insurance and Consumer Goods indices by 0.4 and 0.2 per cent respectively.
However, the volume and value of stocks traded fell by 33.6 and 37.6 per cent respectively to 180.0 million units and N1.53 billion, exchanged in 3,108 deals. The top traded stocks by volume were Zenit Bank (35.9 million units), Access Bank (29.1 million units) and Transcorp (16.5 million units) while Zenith Bank (N605.2 million), GT Bank (N201.3 million) and Access Bank (N187.4 million) led by value.
Investors’ appetite for stocks was mixed as 13 stocks appreciated in value while 13 others depreciated. Studio Press topped the gainers’ chart with 10 per cent to N1.98 per share, International Breweries followed with 7.14 per cent to close at N3, Jaiz Bank increased by 5.36 per cent to close at 0.39% while Japaul Oil garnered 5 per cent to close at 0.21 kobo.
On the flipside, CAP topped the losers’ chart with 10 per cent to close at N15.30 per share. Royal Exchange was next with 9.68 per cent to close at 0.28 kobo, PZ fell by 9.41 per cent to close at N3.85 while UPL lost 7.38 per cent to close at N1.13.
In an emailed note sent to Daily Sun, Afrinvest, said, “ We expect bargain hunting to persist in subsequent trading days”.