Investors in the nation’s stock market lost a whopping N1.89tn last year amid instability in the market. 2018 began on a positive note as the Nigerian Stock Exchange All-Share Index recorded a nine per cent gain in the first quarter of the year, amid growing interest from foreign investors following the introduction of the Nigerian Autonomous Foreign Exchange Rate window in the second quarter of 2017.
In 2017, the ASI gained 42 per cent as it closed at 38,243.19 basis points, while the market capitalisation closed at N13.609tn. The market capitalisation, however, depreciated by N1.89tn as it closed at N11.720tn in 2018, while the ASI shed 17.81 per cent during the year to close at 31,430.50 bps. An analysis of the closing figures in 2017 and 2018 showed that the value of shares traded on the NSE shed N2.94bn, as it dropped from N6.89bn in December 2017 to N3.95bn in 2018.
Analysts say that the uncertainty that emerged in the market was driven by pre-election jitters and weak emerging market sentiment. There were 31 gainers and 100 losers last year, which pegged the market breadth at 0.31x. The volume of transaction grew by 17.27 per cent, while the value declined by 2.80 per cent.
Analysts at Meristem Securities Limited said the bearish performance of the equity market last year was due to negative investor sentiment ahead of the general elections this year and capital flow reversals, given higher interest rate in the United States.
They said, “This affected investors’ participation in the stock market and this was worsened by unimpressive earnings performance by companies on the bourse.”