Capital market operators said on Monday that investors would continue to shy away from equities unless the fluctuations in the foreign exchange market were resolved by the Central Bank of Nigeria.
A cross section of the operators said in Lagos that there was an urgent need to stabilise the Forex regime between the licensed Bureau De Change (BDC) and the official rate.
The reaction came on the heels of the naira hitting a new low of 516 to the dollar on the unofficial market, versus N305 official rate on Friday
Malam Garba Kurfi, the Managing Director, APT Securities and Funds Ltd., Lagos, said the worsening negative macro-economic indices was a threat to investors’ confidence.
Kurfi stated that the cost of doing business would continue to rise, occasioned by the challenges in Forex market.
He reiterated that this was responsible for the rising inflation and interest rates which had impacted negatively on all sectors of the economy.
Mr Ambrose Omordion, the Chief Operating Officer, InvestData Ltd., Lagos, said that the purchasing power of majority had been weakened due to steady increase in the prices of commodities, thereby affecting equity investment.
According to him, people can only invest when they have enough savings.
Omordion said that the nation’s equities had closed negatively for three consecutive weeks due to low investors’ confidence.
He, however, expressed optimism that the market might witness mixed performances this week due to Nigerian Breweries 2016 audited results being expected to hit the market.
Meanwhile, a turnover of 1.07 billion shares worth N8.61 billion were exchanged by investors in 14,486 deals last week.
This is in contrast to the 1.05 billion shares valued at N8.03 billion transacted in 13,586 deals in the corresponding week.
The Financial Services Industry led the week’s activity chart by 930.38 million shares worth N5.70 billion traded in 8,759 deals.
The sector thus contributed 86.70 per cent and 66.24 per cent to the total equity turnover volume and value respectively.
The Consumer Goods sector followed by 52.48 million shares worth N1.99 billion exchanged in 2,513 deals.
The third place was occupied by Conglomerates Sector by a turnover of 22.13 million shares valued at N39.22 million in 499 deals.
The NSE All-Share Index, however, declined by 175.11 points or 0.69 per cent to 25,164.91 points from 25,340.02 recorded the preceding week.
Also, the market capitalisation for the period closed lower at N8.709 trillion from an opening value of N8.769 trillion, representing 0.69 per cent or N60 billion depreciation in value.
PZ Industries topped the gainers’ table in percentage terms by 21.29 per cent or N2.35 to close at N13.39 per share.
Julius Berger gained 10.22 per cent or N3.56 to close at N38.39 and Beta Glass grew by10.22 per cent or N3.38 to close at N36.45 per share.
Conversely, Vitafoam topped the losers’ chart in percentage terms by 13.04 per cent or 30k to close at N2 per share.
Fidson Healthcare trailed with a loss of 11.40 per cent or 13k to close at N1.01 while Nigerian Breweries declined by 8 per cent or N10 to close at N115 per share.