In an excerpt from its weekly report for the trading week ended March 22, 2018, the Nigerian Stock Exchange (NSE) disclosed that it had concluded the biannual review of its various indices. The exchange had rebalanced the index in January this year.
Some stocks would be exiting the various indices, while some would be entering.
Here are lists of likely stocks that would be entering and exiting the various indices. This list, however, is subject to further amendment by the Exchange.
NSE 30 index
The NSE 30 index is made up of the 30 biggest stocks by market capitalization.
Diamond Bank Plc, Julius Berger Nig Plc, Forte Oil Plc, Dangote Flour Mills Plc, and Transcorp Plc are stocks that will exit the index.
FCMB Group Plc, Oando Plc, Beta Glass Co. Plc, UACN Plc, and Sterling Bank Plc are the stocks that could be entering the index.
NSE Consumer Goods Index
Northern Nigeria Flour Mills Plc and Vitafoam Nigeria Plc are likely stocks that will exit the index.
Union Dicon Salt Plc, DN Tyre & Rubber Plc are the stocks that could be entering the index.
NSE Banking Index
Wema Bank Plc and Diamond Bank Plc are the stocks likely to exit the index.
Jaiz Bank and Skye Bank are the stocks that could be entering the index.
NSE Insurance Index
Cornerstone Insurance Plc, STACO Insurance Plc, Standard Alliance Insurance Plc, and Equity Assurance Plc are likely to exit this index.
Consolidated Hallmark Insurance Plc, Sovereign Trust Insurance Plc, Veritas Kapital Assurance Plc, and Regency Alliance Insurance Plc could be entering the index.
NSE Industrial index
Stocks exiting are Portland Paints & Products Nig Plc, and DN Meyer Plc.
Grief Nigeria Plc and Austin Laz & Co. Plc are likely stocks to enter the index.
NSE Oil and Gas Index
Japaul Oil & Maritime Services Plc, and Eterna Plc are the stocks likely to join the index.
Conoil Plc, MRS Oil Nigeria Plc are most likely to exit the index.
NSE Lotus Islamic Index
Nigerian Aviation Handling Co. Plc, Jaiz Bank Plc, and Seplat Petroleum Development Co are likely stocks to join the index.
Lafarge Africa Plc, GlaxoSmithKline Nigeria Plc, and Total Nigeria Plc are those likely to be cut off.
Why does this matter?
For retail investors who do not trade often, the rebalancing may have little effect.
Asset managers such as Pension Fund Administrators (PFAs) and mutual funds tend to keep their portfolios in line with these indices.
For traders, the rebalancing means that the stocks exiting the indices could witness far less trading.
While the Exchange has not fixed a specific date when this would happen, it usually occurs in the first week of July. A telltale sign is significant trades occurring with many of them being in identical orders.
Market capitalization, which is the total worth of a particular stock, and liquidity are the primary criteria for the entry and exit of a stock into the indices. This in no way means that the stock has positive fundamentals.
FRC to implement new IFRS 17
The FRC is set to implement International Financial Reporting Standard 17 (IFRS) on or before January 2023.
The Financial Reporting Council of Nigeria is expected to implement International Financial Reporting
Standard 17 (IFRS) on or before January 2023. This follows the amendment of the standard on June 25, 2020.
This was disclosed by the Head, Directorate of Accounting Standards Public Sector, FRC, Dr. Iheanyi Anyahara, during a Stakeholders interactive forum with FRC and International Accounting Standards Board (IASB) webinar recently.
Nigeria adopted the IFRS as part of measures to improve transparency, reporting practices and full disclosures.
Having adopted the IFRS by the Council, Anyahara explained that all amendments to existing standards alongside the new standards issued by the International Accounting Standards Board (IASB) must be implemented by all reporting entities in Nigeria.
According to him, the Council is aware that implementing IFRS 17 commands a radical departure from current accounting standards and produces complex operational challenges.
He said, “That is why we are organizing this programme and many more in collaboration with IASB to guide the users of the standards both in application and implementation.
“The Council will be organizing more events in financial reporting, auditing and corporate governance in order to sensitize the general public and lessen the knowledge gap in IFRS standards in Nigeria in collaboration with relevant agencies and organisations.”
Last July, Nairametrics reported when FRC released guidelines for reporting in compliance with the Nigerian Code of Corporate Governance. (NCCG 2018).
In a statement posted on its website, the Council explained that it had been engaging with all regulators of sectors for the purpose of developing sectoral guidelines of corporate governance on specific requirements relevant to each sector, which are not covered under NCCG 2018.
Geely Auto to invest 54 million dollars in the development of healthy cars
Geely’s leading track record will be taken to a new level with the development of an all-round “healthier car.”
As Exclusive Partner of Geely Automotive in Nigeria, Mikano brings us great news of Geely Automotive innovative steps towards development of “healthy, intelligent vehicles” by earmarking 54 million Dollars of funding to it; as a furthering of the fight against Coronavirus.
The move not only adds a new dimension to Geely’s understanding of “passenger safety,” it also represents a new development direction for automobiles.
The development of a “healthier car” differs from specialized medical vehicles in that Geely’s products are made for ordinary consumers. Cars with comprehensive virus protection not only require the capability to isolate harmful substances in the air, it also needs to quickly and effectively purify cabin air for occupants.
Geely Auto’s global R&D and design networks based in Europe, USA and China will jointly move to develop and research new environmentally sustainable materials with anti-bacterial and anti-viral properties which can be used within air-conditioner systems and on frequently touched surfaces such as buttons and handles.
Geely Auto will make full use of its global R&D system and resources as well as cooperate with professional medical and scientific research institutions to set up special project teams to work on the new research.
An Conghui, President of Geely Holding Group and President and CEO of Geely Auto Group said “Epidemic prevention is a job that requires the long-term effort of wider society. As the most common mode of transportation, consumers spend a considerable amount time in their cars, akin to a “second home” Only by making healthier products can we meet consumer demand for better quality of life. Based on the automotive industry’s development direction built around electrified, connectivity, intelligence, and shared mobility, auto companies should commit to developing products that help protect the health of drivers and passengers. This will become one of Geely Auto key long-term development objectives.”
Earlier on January 28, Geely Holding Group joined hands with the Li Shufu Foundation to set up a special 30 million dollars fund in support of the new coronavirus prevention and control, with a focus on the mass purchasing of much needed medical supplies for China in the short term.
Geely’s leading track record will be taken to a new level with the development of an all-round “healthier car.” Geely’s move sets a new precedent in the development of safety technologies that goes beyond developing leading crash test results and moves into new dimensions of passenger safety.
Visit www.geely.ng to find out more about Geely Nigeria
Exchange rate falls again at NAFEX window as #EndSARS protests escalates
The Naira depreciated against the dollar at the Investors and Exporters (I&E) window closing at N386/$1.
Nigeria’s exchange rate at the NAFEX window depreciated against the dollar to close at N386/$1 during intraday trading on Monday, October 19.
Also, the naira remained stable against the dollar, closing at N462/$1 at the parallel market on Monday, October 19, 2020, as the protest against the special anti-robbery unit (SARS) and police brutality by the Nigerian youth escalates with its impact on business activities across the country
Parallel market: According to information from Abokifx, a prominent FX tracking website, at the black market where forex is traded unofficially, the Naira remained stable against the dollar to close at N462/$1 on Monday. This was the same rate that it exchanged for on Friday, October 16.
- The local currency had strengthened by about 7.8% within the one week in September at the black market, as the CBN introduced some measures targeted at exporters and importers, in order to try to boost the supply of dollars in the foreign exchange market, and reduce the high demand for forex by traders. The measure
- The CBN has sold over $500 million to BDCs since they resumed forex sales on Monday, September 7, 2020. This was expected to inject more liquidity to the retail end of the foreign exchange market and discourage hoarding and speculation.
- However, the exchange rate against the dollar has remained volatile after the initial gains made, following the CBN’s resumption of sales of dollars to the BDCs.
- The President of the Association of Bureau De Change Operators, Aminu Gwadebe, said he expects the impact of the extra liquidity in the market to be gradual.
- Despite the drop in speculative buying of foreign exchange, the huge demand backlog by manufacturers and foreign investors still puts pressure and creates a volatile situation in the foreign exchange market.
NAFEX: The Naira depreciated against the dollar at the Investors and Exporters (I&E) window on Monday, closing at N386/$1.
- This represents a 17 kobo drop when compared with the N385.83/$1 that it exchanged for on Friday, October 16.
- The opening indicative rate was N386 to a dollar on Monday. This represents a 38 kobo gain when compared to the N386.38 that was recorded on Friday.
- The N392.30 to a dollar is the highest rate during intraday trading before closing at N386. It also sold for as low as N380/$1 during intraday trading.
Forex turnover: Forex turnover at the Investor and Exporters (I&E) window declined by 3.6% on Monday, October 16, 2020.
- According to the data tracked by Nairametrics from FMDQ, forex turnover dropped from $125.40 million on Friday, October 16, 2020, to $120.93 million on Monday, October 19, 2020.
- The CBN is still struggling to clear the backlog of foreign exchange demand, especially by foreign investors wishing to repatriate back their funds.
- The drop in forex supply after the huge increase 2 trading days ago reinforces the volatility of the foreign exchange market. The supply of dollars has been on a decline for months due to low oil prices and the absence of foreign capital inflow into the country.
- As part of the measure to check forex abuse and check illegal transactions, the CBN last month directed the freezing of accounts of about 38 companies.
- The average daily forex sale for last week was about $169.93 million, which represents a huge increase from the $34.5 million that was recorded the previous week.
- Total forex trading at the NAFEX window in the month of August was about $857 million, compared to $937 million in July.
- The exchange rate is still being affected by low oil prices, dollar scarcity, a backlog of forex demand and a shaky economy that has been hit by the coronavirus pandemic.
- According to Reuters, currency traders said that the naira is expected to be stable this week as banks limit foreign exchange transactions by both firms and individual buyers on the unofficial black market to curb speculation.Explore Data on the Nairametrics Research WebsiteDownload the Nairametrics News App