Economy
NSE Helps Investors Recover N305m Shares, Get N17m Compensation
By Dipo Olowookere
In 2020, the Nigerian Stock Exchange (NSE) facilitated the restitution and recoveries of shares worth N305.11 million for investors.
Also, the exchange assisted not less than 49 investors/claimants who suffered pecuniary losses to get compensation worth N17.02 million in the year.
The Chief Executive Officer of the NSE, Mr Oscar Onyema, while speaking Tuesday during the review of the bourse’s performance last year and what to expect in 2021, assured that the exchange will continue to protect investors to deepen the market.
He also said reiterated the intention of the exchange to aggressively pursue cutting-edge products and services, access new markets and deliver better value to its stakeholders.
Mr Onyema described “the year 2020 [as] a historic one for global capital markets,” especially the Nigerian market, which recorded a growth of over 50 per cent despite the “buffeting headwinds.”
He attributed this to the “renewed investor optimism coupled with improved economic conditions and low fixed income yields.”
“Of 93 global equity indices tracked by Bloomberg, the NSE All-Share Index (ASI) emerged the best-performing index in the world, surpassing the S&P 500 (+16.26 per cent), Dow Jones Industrial Index (+7.25 per cent) and other global and African market indexes, to post a one-year return of +50.03 per cent,” he said.
He noted that this year, the bourse has started “on a positive note as the ASI has already returned 2.0 per cent after 11 trading sessions.”
“We expect the marginal reopening of businesses, normalisation of the economy and revenue-diversification drive of the Nigerian government to elicit positive sentiments throughout the year,” he added, warning that, “Our growth expectations should be noted with caution, as the recent second wave of COVID-19 in Nigeria and globally, may slow down renewed social and economic activities.”
Mr Onyema expressed optimism that the exchange’s vision to be Africa’s preferred Exchange Hub would be achieved with the transitioning of the NSE to a demutualised exchange group and the appointments of Mr Temi Popoola as the CEO of NGX and Ms Tinuade Awe as CEO of NGX REGCO.
Last year, the Nigerian equities market got off to a strong start, returning 10.4 per cent by the eighth trading session and by October, it entered a much-awaited bull run.
Buoyed by the formal declaration of the U.S president-elect, unattractive fixed-income yields and better-than-expected corporate earnings, the NSE ASI recovered from Q1’20, to close the year at 40,270.72 (+50.03 per cent) and erase losses of 14.90 per cent recorded in 2019.
During its remarkable year-end run, the ASI gained 6.23 per cent in a single trading session which triggered a 30-minute halt of trading on all stocks for the first time since the NSE Circuit Breaker was introduced in 2016 to safeguard market integrity in periods of extraordinary volatility.
At the close of the year, the NSE’s equity market capitalization was up by 62.42 per cent, from N12.97 trillion in 2019 to N21.06 trillion in 2020 while market turnover saw an uptick of 7.25 per cent, from N0.96 trillion in 2019 to N1.03 trillion in 2020.
Although Initial Public Offering activity was mute, the value of supplementary issues increased dramatically from 2019, rising by 851.37 per cent to N1.42 trillion, from N148.77 billion.
Also noteworthy is that for the second consecutive year, equity market transactions were dominated by domestic investors who accounted for 65.28 per cent of market turnover by value (retail: 44.98 per cent; institutional: 55.02 per cent) while foreign portfolio investors accounted for 34.72 per cent.
Capital-raising activities in the fixed income market increased significantly in 2020 as the NSE’s bond market capitalisation rose by 35.52 per cent from N12.92 trillion in 2019 to N17.50 trillion.
Continuing the trend in recent years, the Federal Government of Nigeria dominated issuances, raising over N2.36 trillion which comprised nearly 92 per cent of total bond issuances. Corporates also leveraged the low yield environment to fund expansion objectives and pursue debt refinancing, raising a total of N192 billion.
Business Post reports that apart from Mr Onyema, a presentation was made by the Managing Director/Chief Economist, Africa and the Middle East, Global Research at Standard Chartered Bank, Ms Razia Khan, who provided insights into the global macroeconomic environment and the outlook and opportunities in the Nigerian capital market.
By Adedapo Adesanya
The Naira further appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, July 16, by 65 Kobo or 0.04 per cent to sell for N1,381.53/$1, in contrast to Wednesday’s closing value of N1,382.18/$1.
This was buoyed by improved FX liquidity to absorb the high demand for Dollars during the trading session.
However, the local currency depreciated against the Pound Sterling in the official market yesterday by N9.48 to close at N1,866.17/£1 versus the preceding day’s N1,856.69/£1, and lost N2.99 against the Euro to quote at N1,582.68/€1 compared with the midweek rate of N1,576.69/€1.
At the parallel market, the Nigerian currency maintained stability against its United States counterpart at N1,405/$1, and at the GTBank FX desk, it remained unchanged at N1,389/$1.
On Thursday, data from the Central Bank of Nigeria (CBN) showed a surge in interbank FX turnover and deal count. Interbank FX activities at the NFEM window increased sharply by 69 per cent to $205.366 million from $121.727 million reported the previous day.
Nigeria’s gross external reserves continue to rise, supported by steady foreign exchange inflows from hydrocarbon receipts, remittances and foreign portfolio investments, boosting market confidence. It settled at $51.893 billion from $51.867 billion the previous day.
The apex bank has also launched a new digital platform that will track every foreign exchange transaction involving Bureau De Change (BDC) operators, marking a major step in its efforts to improve transparency and strengthen oversight of Nigeria’s retail forex market.
In an operational guidance issued on July 15 to authorised dealer banks and licensed BDCs, the CBN introduced the FX BDC Purchase Tracker (FXBT), a centralised electronic portal that will monitor foreign exchange purchases by BDCs from the point of request through approval, settlement and eventual sale.
As for the crypto market, prices were down as the markets weighed fresh US airstrikes on Iran that boosted risk sentiment, with Ethereum (ETH) down by 4.7 per cent to $1,829.37.
Solana (SOL) decreased by 3.6 per cent to $77.49, Dogecoin (DOGE) depreciated by 3.1 per cent to $0.0718, Cardano (ADA) also crashed by 3.1 per cent to $0.1588, Bitcoin (BTC) slumped by 2.9 per cent to $62,820.21, Ripple (XRP) dipped by 2.6 per cent to $1.08, Binance Coin (BNB) fell by 2.3 per cent to $569.02, and TRON (TRX) shrank by 0.8 per cent to $0.3219, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
By Aduragbemi Omiyale
In a bid to help investors recover about N270 billion in unclaimed dividends in the capital market, a nationwide enlightenment campaign has been launched by the Securities and Exchange Commission (SEC).
This initiative involves town hall meetings that would go around the country to sensitise Nigerians on the need to claim these fallow funds.
The Director General of SEC, Mr Emomotimi Agama, speaking at a town hall meeting in Lagos, said the regulator is not happy that investors, who worked hard to purchase shares in the stock market, have not claimed their profits for many years, making unclaimed dividends pile up.
“The commission considers this situation unacceptable. Funds belonging to investors should ultimately find their way back to their rightful owners,” the SEC chief, represented at the event by the Director of Registration and Exchanges, Market Infrastructure Department, Ms Hafsat Rufai, stated.
He said during this campaign Nigerians would be informed of the unclaimed monies, the role of the National Investor Protection Fund (NIPF), and the procedures for verifying and recovering legitimate claims, stressing that SEC is committed to ensuring that investors’ funds are returned to their rightful owners.
The DG stated that unclaimed monies administered by the NIPF include return funds from public offers, scheme consideration arising from mergers, acquisitions and corporate restructuring transactions, as well as other capital market-related funds that have remained dormant.
He disclosed that the town hall meetings would be held in the six geopolitical zones and the Federal Capital Territory.
In addition, electronic and social media platforms would be used to broaden public awareness on this issue, with efforts to be made to address the transmission of securities following the death of an investor, noting that many families were either unaware that their deceased relatives owned shares or lacked knowledge of the legal and administrative procedures required to transfer such investments to rightful beneficiaries.
“As a result, valuable investments and returns on investments sometimes remain inaccessible for many years, thereby denying beneficiaries the financial benefits intended for them,” he said, urging investors to maintain proper records of their investments and encouraging families to take proactive steps to preserve inherited wealth.
By Dipo Olowookere
The decision of investors to book profit after the previous session’s gains pulled back Customs Street by 0.09 per cent on Thursday.
The selling pressure was mainly on BUA Cement, which put the Nigerian Exchange (NGX) Limited off-balance during the session.
Analysis of the trading data showed that the industrial goods sector was the sole decliner, losing 2.85 per cent, as a result of the poor performance of BUA Cement at the market yesterday.
The other key sectors of the bourse were bullish, with the banking space up by 2.87 per cent. The consumer goods index appreciated by 0.30 per cent, the insurance counter improved by 0.16 per cent, and the energy segment rose by 0.08 per cent.
At the close of business, the All-Share Index (ASI) went down by 221.14 points to 242,145.61 points from 242,366.75 points, and the market capitalisation decreased by N32 billion to N156.207 trillion from N156.239 trillion.
Eunisell crashed by 10.00 per cent to N189.00, BUA Cement lost 9.99 per cent to quote at N275.60, CAP declined by 9.61 per cent to N142.45, Royal Exchange slipped by 9.55 per cent to N1.42, and Guinea Insurance tumbled by 5.38 per cent to 88 Kobo.
Conversely, First Holdco soared by 9.96 per cent to N87.25, McNichols gained 8.00 per cent to trade at N5.40, UBA appreciated by 7.93 per cent to N44.25, Veritas Kapital jumped by 6.85 per cent to N1.56, and Jaiz Bank chalked up 4.07 per cent to settle at N8.95.
It was observed that the market breadth index was positive after the exchange closed the session with 22 price losers and 27 price gainers, representing strong investor sentiment.
A total of 498.5 million shares valued at N34.9 billion were traded in 39,484 deals on Thursday, in contrast to the 476.3 million shares worth N29.6 billion transacted in 40,992 deals on Wednesday. This indicated that the trading volume grew by 4.66 per cent, the trading value increased by 17.91 per cent, and the number of deals depreciated by 3.68 per cent.
Japaul ended the day as the busiest equity after trading 77.7 million units for N231.5 million, Access Holdings sold 41.2 million units valued at N1.0 billion, First Holdco exchanged 38.8 million units worth N3.4 billion, UBA transacted 31.5 million units for N1.4 billion, and Fidelity Bank traded 23.8 million units worth N495.0 million.
