Investors to ‘Bombard’ Nigerian Stock Market This Week

By Dipo Olowookere

Last week, the Nigerian Stock Exchange (NSE) closed in the positive territory with a week-on-week 0.08 percent growth. This was after opening and closing the week strong.

It was observed that the gains were boosted by stocks in the banking space, which have remained the most trusted and cheapest to buy for price appreciation and others.

As at the close of business last Friday, the year-to-date loss stood at 16.28 percent. Even though the local bourse may not close positive this year, the year-to-date loss is most likely to near a single-digit.

As investors prepare for this week’s four-trading sessions as a result of the public holiday observed on Monday in Nigeria, analysts have expressed their views on what to expect from the market.

Analysts at Business Post are of the opinion that the market would be flooded by investors looking to reconsider the equity market after the Central Bank of Nigeria (CBN) stopped them from investing in OMO bills, which used to be the hot cake.

In addition, as yields in the fixed income market are getting less attractive, investment in stocks would be the next option, causing the return of bulls to the space. This even happened in the previous week.

“We believe that local retail investors will find the stock market attractive again. This will make the market to be busy as traders mop up equities especially in the banking space. Thereafter, we expect them to sell when prices are high so as to take profit,” Business Post analysts opined.

Also, commenting on outlook for the market this week, financial experts at Cowry Asset said, “In the new week, we expect the domestic bourse to close in green amid bargain hunting activity, even as the yield on fixed income investments become less attractive.

“Also, we expect funds to flow into equities market amid CBN’s restriction of the local non-bank corporates and the retail investors from participating in OMO auctions.”

In the views of those at United Capital Research, “This week, we expect investors to continue to act on the recent results released, and policy pronouncements in the fiscal space.

“With excess liquidity in the overall financial system, and the ripples occurring in the fixed income market, we could see continued interests in the local equities.”