Stock Market Investors Lose N1.2trillion In First Four Months of 2016

Investors on the Nigerian Stock Exchange, NSE, have lost a staggering N1.2 trillion in the first four months of 2016, as the abysmal performance on the bourse in the last two years lingers.

This development has left the NSE as the worst performing stock exchange among its peers in other African countries.

Available data showed that the NSE has returned negative 12.5 per cent within this period, thereby consolidating the negative performance sustained in the last two years.

Opening the year at N9.50 trillion, the market capitalisation of all listed equities slumped by N1.2 trillion, representing -12.5 per cent decline compared to N8.62 trillion posted at the end of April, 2016.

Also the All Shares Index, ASI, which opened the year at 28,642.25 points, dropped by 3,579.84 basis points to close at 25,062.41 points, again, representing -12.5 per cent year-to-date return.

The NSE had in 2015 retreated by17.4 per cent compared to a decline of 16.14 per cent in 2014. The ASI lost 6014.90 points or 17.4 per cent to close for the year at 28,642.25 on Dec. 31, 2015 from the 34,657.15 it opened for the year, while market capitalization, which opened for the year at N11.478 trillion in 2015, lost N1.63 trillion to close at N9.850 trillion on Dec 31, 2015.

Meanwhile, operators have blamed the declining returns in the nation’s capital market to poorly articulated economic policies by the economic managers.

Of all the major stock exchanges surveyed by Financial Vanguard, the NSE recorded the worst investors’ return during the first four months to April, 2016.

Just like the first quarter of the year where the NSE underperformed all the major exchanges, it continued the trend into the fourth month, coming just closely behind Ghana and Zimbabwe stock exchanges which returned negative 8.3 per cent and 7.9 per cent year-to-date respectively.

The NSE outperformed only Mauritius Stock Exchange which recorded -1.6 per cent return. The Egypt Stock Exchange outperformed all the other major exchanges during the four month period, recording 11.0 per cent returns, followed by Tunisia’s Dar es Salaam with 6.2 per cent returns.

BVRM and the Johannesburg Stock Exchange, JSE, recorded 4.9 per cent and 4.5 per cent returns respectively, while Nairobi Stock Exchange returned 0.6 per cent to investors.