It is often said proverbially that “when it rains, it pours”. So was it on Friday when world markets were routed by the unexpected “Armageddon” that came with UK’s vote to leave the EU. Nigerians will tell you that it is after the race that you count the miles. For Brexit, it does look like the counting of the miles will last for a long time. However, some of its effects were almost immediate as Global markets witnessed sell offs and panics. The S&P lost 3.6% of its value erasing its 2016 gains and recording its worst one-day loss in 10 months. The DOW plunged more than 600 points or 3.39% which, like the S&P, marked its worst one-day loss in 10 months. The Nasdaq dropped 202 points, or 4.12 percent while Japan’s Nikkei 225 saw its worst day since March 2011 falling by 7,02%. It is estimated that the global markets lost about $2.1 trillion on Friday.
According to Bloomberg Billionaires Index, “the world’s 400 richest people lost $127.4 billion” on Friday as a result of Brexit Vote. This represented a 3.2% as the net worth of those billionaires fell to $3.9T. Europe’s riches man, Amancio Ortega was the hardest hit as he lost more than $6 billion while the likes of Bill Gates made losses in the neighborhood of $1 billion each. It is not yet known how much Nigeria’s and African richest man, Aliko Dangote lost to Brexit but it is not expected to be much like the losses of Bill Gates and co.
Back home in Nigeria, the effect does not seem to have been felt as much as in the west. The Nigeria All Share Index fell by 1.36% to close at 30,649.66 points with market capitalization falling by only N0.12T. Comparatively, the loss in the Nigerian market is a far cry from what happened in the US, Japanese or UK markets may be because the economic impact of the UK on Nigeria is minimal, if at all. Unlike the likes of S&P whose 2016 gains got erased, most of the major indexes in Nigeria still remain profitable on a YTD basis except for NSE-Lotus Islamic Index (-.94%), NSE Insurance Index (-1.7%) and NSE Oil & Gas Index (-5.03%). In a day when the world saw red, 21 equity positions in Nigeria recorded gains while 30 ended the day with loses. The Nigerian market still boasts of about 43 equities that carry positive YTD returns many of which are in double digits. See All Stock/Index Performance
For Nigerian stock market investors, it is business as usual, Brexit or no Brexit.