NEW FOREIGN EXCHANGE POLICY: Nigeria Stock Exchange Bounces Back, Naira Stable In 48hrs

-


Punch Newspaper - The Nigerian Stock Exchange All-Share Index on Wednesday posted the biggest return since the beginning of this year, as investors reacted positively to the Central Bank of Nigeria’s Monetary Policy Committee’s decision to allow a flexible foreign exchange regime.

The market capitalisation appreciated by N354bn to close at N9.706tn from N9.352tn on Tuesday, while the NSE ASI closed at 28,260.61 basis points from 27,231.50 basis points the previous day.

Tuesday’s decision of the CBN to adopt a flexible exchange rate policy was a shift from a peg of 197 to 199 for the naira, against the dollar which analysts see as overvalued and hampering investments.

A total of 474.402 million shares worth N3.503bn exchanged hands in 5,260 deals on the floor of the NSE on Tuesday.

The financial services and industrial goods sectors were the biggest beneficiaries of the renewed investor interest as they gained 589 basis points and 416 points. United Bank for Africa, Oando Plc, Zenith Bank Plc, Diamond Bank Plc and FCMB Group Plc emerged as the top five gainers.

UBA shares appreciated by N0.45 to close at N4.87 from N4.42, while those of Oando closed at N6.63 from N6.02 the previous day.

The price of Zenith Bank’s stocks closed at N16.51 from N15.00 on Tuesday, appreciating by N1.51, while that of Diamond Bank rose to N2.11 from N1.92, gaining N0.14. FCMB shares also appreciated by N0.14 to close at N1.56 from N1.42 the day earlier.

The top five losers were Mobil Oil Nigeria Plc, Union Dicon Salt Plc, Glaxo SmithKline Consumer Nigeria Plc, Ikeja Hotel Plc and Forte Oil Plc.

FBN Holdings Plc topped the volume chart for the second consecutive session, trading 73 million units, whilst GTBank led the value chart, trading 46 million units worth N960m.

Analysts at Vetiva Capital Management Limited said, “Given the strong demand observed in today’s (Wednesday) session as indicated by market breadth, volume and value, we see room for further gains in Thursday’s (today) trading session as the MPC’s decision to adopt a flexible exchange rate continues to whet investor appetite for stocks across sectors.”

Bond prices also rose as traders bought debt to cover positions taken before the central bank decision as they had expected the main rate to stay at 12 per cent to boost the country’s economy in view of slowing growth.

However, the naira remained flat against the United States dollar at the parallel on Wednesday as news over the adoption of a flexible exchange rate policy by the CBN created uncertainties in the forex market.

The naira, which closed at 346 against the dollar at the parallel market on Tuesday, maintained the same value on Wednesday.

Analysts said forex traders were confused over how the new rules would be implemented. The central bank has only said it will give guidance within days.

The forex traders, however, said they expected the policy shift to boost dollar supply and lure back foreign investors.

Comments

Post a Comment

The views expressed in comments published on my blog are those of the comment writers alone. They do not represent the views or opinions of queendoosh.com. Please take note.

Popular posts from this blog

NEW! Scientists Develop Vaccine For HIV/AIDs

-
Image
A new vaccine-based treatment for HIV has succeeded in suppressing the virus in five patients, raising hopes further research could help prevent Aids without the need for daily drugs. Independent of the United Kingdom reported on Friday that researchers combined two innovative HIV vaccines with a drug usually used to treat cancer in the trial, conducted over three years at the IrsiCaixa Aids Research Institute in Barcelona. After receiving the treatment, the virus was undetectable in five out of 24 participants and its spread was stopped by their immune systems, reported the New Scientist. One of them has been drug-free for seven months. Around 18 million people – half of all those living with HIV around the world – take ART to slow the progression of the infection, according to the UN. But these drugs are expensive and can cause unpleasant side effects. Patients have to remember to take them every day, sometimes over their entire lives. Mitchell Warren, executive dire...
NEXT PAGE »

Senate Indicts Ngozi Okonjo-Iweala Over Loss of N1.6tr Revenue

-
Image
Nigeria's imediate past minister of Finance ,Ngozi Okonjo-Iweala has been indicted by the Nigerian senate over a N1.7t loss in revenue. According to the Senate Ad Hoc Committee on Alleged Misuse, Under-Remittance and Other Fraudulent Activities, revenue agencies short-changed the Federal Government to the tune of N1.7tn as unremitted revenue generated between 2012 and 2016. The panel blamed it on a memo by a former Minister of Finance, Mrs. Ngozi Okonjo-Iweala, who allegedly issued the memo to the agencies to remit 25 per cent of revenue they generated to the Federal Government and spend 75 per cent on their expenditures. An interim report by the committee chaired by Senator Olamilekan Adeola, details this. The panel said the amount to be remitted to the Federal Government during the period by 93 agencies it investigated was N21.5tn. It alleged that 25 of the 93 agencies covered defrauded the government of a total of N1,695,585,887,406.
NEXT PAGE »