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Chinwendu Obienyi
For the Nigerian capital market to achieve growth and develop like its peers accross the world, there has to be a clinical review as well as friendly policies on the part of the Federal Government.
This was the view of experts who spoke to Daily Sun yesterday via telephone while stating the the Nigerian stock market has fared well. President Muhammadu Buhari while making his independence speech, noted that his administration remains committed to responsibly managing the country’s oil wealth endowments while adding that it will continue to prudently save its Oil income and invest more in the non-oil job-creating sectors.
However, market analysts noted that the current situation of the economy has recorded mixed fortunes over the years. For example, despite the continuing price depreciation, the nation’s bourse average year-to-date return stands at -12.3 per cent, equivalent to net capital depreciation of N1.46 trillion in 8 months for 2019 while Nigeria’s Gross Domestic Product (GDP) declined by 0.16 per cent in the second quarter of 2019, when compared with 2.10 per cent in the first quarter of 2019. Head, Research and Investments, FSL Securities Limited, Victor Chiazor, noted that the capital market has fared well and urged the government to find ways of bringing more companies to list on the domestic bourse.
“Currently, the market is about 10 per cent of Nigeria’s GDP which can be better if you look at the likes of South Africa which is about 24 per cent. We still have a long way to go but i think we have done well giving the kind of economy we run. Chairman, Progressive Shareholders Association of Nigeria (PSAN), Boniface Okezie, said the market has been bastardised even as there is absence of economic direction.
He said, “Economic direction is still absent as the bears have continued its grip on Nigeria’s trading floor. This celebration calls for sober reflection on where we missed it. Nigeria ought to be number one in Africa when it comes to stock market trading not Johannesburg or Kenya or even Ghana but because we fail to consolidate on our gains, these countries are now above us”.
For his part, Chief Executive Officer, Sofunix Investment and Communications, Sola Oni on his own part, explained that the federal government’s lethargic approach towards utilizing the market remains the elephant in the house even the market is grossly undervalued across the board.
