“Nigerian Stock Market to Face Hard Times in 2016” – United Capital Predicts

The Nigerian stock market in 2016 will be plagued by poor stock performances due to the poor condition of the naira against dollar as well as the dwindling oil prices,United Capital Plc has predicted.

United Capital Plc in its 2016 outlook titled ‘a slippery path to recovery, finding the new equilibrium’ said the dominance of foreign participation in the last 4 years has led to the market’s seamless reaction to global shocks.

Group Chief Executive Officer of United Capital Plc, Oluwatoyin Sanni, said Nigerian equities is in dire need of increased local participation.

According to her, market volatility and sell pressure has been majorly driven by capital flight, buttressing the need for increased local participation to insulate the domestic market from external shocks and currency volatilities.

She believed that the Central Bank of Nigeria’s disposition to foreign investors will be a key driver of equities movement in 2016 as uncertainty around foreign exchange will continue to impact market sentiment.

Sanni stressed that oil price trajectory will remain a key driver of equity market direction, saying “we expect crude oil prices to trade lower in 2016, portending a downside to Nigerian equities.”