Nigeria Stock Exchange emerges in the top 5 exchanges for 2017

 

Global stock markets pushed up $12.4trillion dollars in capitalization for the year 2017 with the US Stock Markets leading the volumes. Investors appetite to pile up more money into capital markets rose with promise of unbundling strict controls on the banking and financial markets that triggered the crisis in 2008 by two members of the US Congress known as Christopher Dodd and Barney Frank, as well as cutting down of corporate taxes by as much as 18% for corporate entities to 20% in the biggest tax cuts for the rich since President Richard Nixon in the 1980’s. CNN Money reports that Mauricio Macri’s led reforms in Argentina caused the stock market to rally up as much as 73% in the Year 2017, while Oscar Onyeama’s leadership of the Nigeria Stock Exchange set the bourse on a 43% recovery with a capitalization that has brought the all share index back to 13trillion naira, a level that was last seen in 2008 before the financial crisis.

Oil price slump that triggered a sharp drop in the value of the naira led foreign investors to sell off on the NSE, as well as policy uncertainties, Ebola Crisis, Militant attacks caused a route for the markets in 2015 & 2016. But the recovery in the price of oil that has also stabilized a flow of dollars in the wholesale dutch auction supply of currency to the markets has stabilized the naira and brought back the foreign direct investment flows into the capital markets.

Zin Bekalli, Founder & CEO of Silk Invest speaking to CNN Money said “If you look at where we stand today, the Nigerian markets is still one of the cheapest markets on the planet.”

On the 16th January 2018, Oscar Onyeama CEO of the Nigeria Stock Exchange will hold a Conference to present his plan to attract more listings of companies and bonds as a means to attract capital to the investors through the exchange, increase capitalization, boost investor confidence and promote credit flow in the Nigerian Economy.

Kelvin Emmanuel

About Kelvin Emmanuel

The Oil producing Angola in the Southern part of Africa faces what Nigeria faced 12months ago; a distortion in its exchange rate with a difference between the official markets and the parallel black markets. One dollar through the official window buys you 166 kwanza, while one dollar through the black market buys you 400 kwanza. Nigeria faced the same challenge 12months ago, when the distortion between the official and black markets was as much as the official markets trading at 306 with the parallel market ranging from 450 through to 510. The Central Bank Governor of Angola, Jose de Massano Junior announced in Luanda “We will stop having a fixed foreign exchange, we will adopt a floating regime of foreign exchange”. Angola faces exactly the same challenges and has been applying the exact same responses to an exchange rate crisis like using its foreign reserves that was sitting at $26bn to defend the currency kwanza, with no success so far, even though the external reserves has dropped to $14bn. Angola relies on Oil receipts for 80% of its government revenue, 90% of its inflow and 50% of its GDP. Angola is a $194bn economy that has been growing at an average of 10% on the back of rising oil prices since 2002 when its 27 year old civil war that started in 1975 ended. The state national oil company Sonangol reports that it produces up to 1.8m barrels of crude oil daily, however the government that until now has being led by the family dynasty Jose Eduardo dos Santos until recently when succession saw power transferred to Joao Lourenco, reports that the oil price rout in 2015/2016 that saw prices drop to as low as $28 per barrel caused ripples across the economic structures of the government, upsetting government revenues, its ability to fund its budget, capital project funding, foreign direct investments into the economy as a result of a currency crisis that was driven by the widening of gap between the official and street window of the kwanza, that until now has been pegged in a fixed exchange rate regime to the US Dollar.