Trading activities on the floor of Nigerian Stock Exchange (NSE) yesterday extended its decline with a record of N85 billion loss following news of presidential results, which favoured the incumbent, Muhammadu Buhari of the All Progressive Congress (APC)
Some market analysts who believed the market reacted cautiously following political uncertainty as the main opposition party, the People’s Democracy Party (PDP) rejected the results and have resolved to seek redress in the court of law.
Stock investors reacted negatively, with the market performance indices falling 0.7 per cent, bringing its two-day drop to 1.4 per cent.
Consequently, the All-Share Index dropped by 229.58 basis points or 0.7 per cent to close at 32,244.24 index points as against 32,473.82 recorded the previous day while the market capitalisation declined N85 billion to close from N12.109 trillion to N12.024 trillion.
Meanwhile, a turnover of 456.07 million shares exchanged in 5,416 deals was recorded in the day’s trading.
The banking sub-sector sub-sector was the most active (measured by turnover volume); with 262.6 million shares exchanged by investors in 1,766 deals.
Volume in the sub-sector was largely driven by the activities in the shares of Diamond Bank Plc and Fidelity Bank Plc.
Premium sub-sector boosted by the activities in the shares of Access Bank Plc and UBA Plc followed with a turnover of 83.3 million shares in 1,476 deals.
The number of gainers at the close of trading session was 10 while decliners also closed at 30.
Further analysis of the day’s trading showed that Neimeth Healthcare Plc topped the gainers’ table with 9.84 per cent to close at 67 kobo per share while PZ Cussons followed with 9.35 per cent to close at N13.45 per share and NPF MFB Plc with a gain of 8.72 per cent to close at N1.62 per share.
On the flip side, Union Dicon Plc led the losers’ chart with a drop of 9.68 per cent to close at 28 kobo per share. Oando Plc followed with a loss of 9.66 per cent to close at N6.55 per share while Wema Bank Plc. dropped by 8.24 per cent to close at 78 kobo per share.
Reacting to the development, the chairman of Association of Stockbroking Houses of Nigeria (ASHON) said investors need to be cautious as the opposition parties are crying foul over alleged rigging of the election.
“The uncertainty is still on the air as regards taking position in the market. The market will continue to react cautiously until the coast is clear. Already the report of foreign observers is showing that there was integrity issue as regards the outcome of the election,” he said.
According to research by Bloomberg Economics, if President Muhammadu Buhari wins another four-year term it would probably mean more political interference in Nigeria’s economy and slower growth. “The opening of the Egina offshore oilfield this month and the Dangote refinery next year will deliver a near-term boost, but low capital investment is likely to inhibit growth over the medium term. BE expects Nigeria, Africa’s largest oil producer, to keep losing ground in real GDP per capita against its peers in Sub-Saharan Africa” the report noted.