The Nigerian Stock Exchange (NSE) has
said that its $1 trillion market
capitalisation by 2016 would no longer be
possible.
The chief executive officer (CEO) of the
NSE, Mr Oscar Onyema, stated this during
the 2014 market recap and outlook for
2015, yesterday, in Lagos.
The NSE boss said the $1 trillion target
by 2016 across five assets classes will no
longer be possible to meet due to the
current situation of the market.
Looking at the market capitalisation as at
January 14, 2014, which stood at N9.514
trillion, it will take the NSE N173.486
trillion to reach a target of $1 trillion
(N183 trillion) in 2016. According to him,
“We believe that our new strategy, up to
2019, has more realistic targets and those
targets are really based on meeting three
objectives.”
He noted that in 2015, the exchange will
focus on delivering several initiatives in
support of its revised strategy.
“Key amongst these initiatives is to
promote the Nigerian capital market as
an African hub for growth companies,
attract more domestic flows into the
market, implement a more competitive
price structure in conjunction with the
regulator and other market participants,
and intensify its efforts towards
developing a more sustainable market,” he
said.
Recapping 2014, Onyema said bearish
sentiments prevailed for most of the year
as foreign investors steadily withdrew
from the Nigerian market due to currency
risk, the recovery of developed economies,
and the effects of the United States (US)
Federal Reserve tapering of its
quantitative easing policy.
“Several macroeconomic developments
also contributed to the decline in market
performance. These were fall in crude oil
prices and related pressure on the naira;
the impact of the Central Bank of Nigeria
(CBN)’s monetary policy changes
introduced at various points throughout
the year; Nigeria’s declining foreign
reserves; festering insurgency in the
nation; uncertainty around the upcoming
2015 elections; and weak corporate
earnings,” he added.
According to him, although economic
growth projection for 2015 will be greatly
impacted by the challenges above, we
expect that as time progresses, and as
uncertainty is steadily reduced across all
the risk categories that negative
sentiment in the market will begin to
subside with volatility slowing in the
second half of the year, strengthening
potential for a market rebound.
He noted that the NSE will pursue an
increase in the number of initial public
offerings and share listings in 2015, while
also targeting Nigerians living abroad to
boost their participation in the market.
No comments: