The Nigerian Stock Exchange (NSE) has assured that the growth trajectory witnessed since the beginning of the year in the market would be sustained in 2020, as it is set to work closely with all stakeholders.
Chief Executive Officer, NSE, Oscar Onyema, explained that the management of the bourse would ensure the market sustained the tempo it started the year with.
Onyema, who spoke while presenting the key performance of the Exchange in 2019 and outlook for 2020 on Monday, said, “The year 2020 has started on a good note, with the NSE ASI recording a 9.41% improvement year-to-date as at January 10. We intend to work closely with our stakeholders to sustain this growth trajectory.
“As African Champions, we will maintain momentum in executing the NSE’s 2018 – 2021 Corporate Strategy in our efforts to elevate the prominence of Africa’s global financial markets.
“In its aspiration to become a more agile and demutualized exchange, and pursuant to the SEC’s ‘No Objection’ rule, The Exchange will proceed to the next steps which include seeking formal approval from its members on demutualization Scheme.
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“While keeping an eye on the strategic intent post-demutualization, The Exchange commits to leveraging its vast network of stakeholders, in addition to developing new strategic partnerships to deliver better products and services to the investing public.”
Reviewing the market, Onyema told Nairametrics that the market mirrored the performance of the larger economy, which continued its moderate path of recovery, growing by 2.28% (Q3’19).
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He added that the Nigerian bourse witnessed the impact of various factors including a weak macroeconomic landscape; fiscal and monetary policy direction; underwhelming trends in Foreign Portfolio Investments; concerns around the stability of the naira and moderate corporate earnings.
“While these factors led to negative performance in the equity market during the year, our Fixed Income market performed exceptionally well, reflecting a flight to safety,” he added.
Key highlights: Global market
- The Nigerian bourse had to compete with developed and emerging capital markets, which saw risk-based assets priced/valued more competitively. \
- Capital conducive US Fed policy enabled foreign investors to economically enhance leverage and seek investment opportunities in their home and adjacent countries, necessitating Africa’s largest economy to adjust to new economic realities.
- Although NSE’s All Share Index (ASI) posted a negative return of -14.60% to close the year at 26,842.07, the ASI reached a year-high of 32,715.20 in February 2019.
- Equity market capitalisation increased by 10.55% to N12.97trillion from N11.73Tn in 2018, largely due to sustained primary market activities throughout the year, most notably the listings of MTN Nigeria Communications Plc and Airtel Africa.
- The fixed income market performed exceptionally well in 2019, as market capitalisation increased by 20.42% to N12.92Tn from N10.72Tn in 2018.
- Turnover also increased by 389.26% when compared to 2018 although capital raising was dominated by the Federal Government, being responsible for 60% of bond issuances during the period in a bid to finance fiscal and infrastructure deficits.
- A new market structure was conceived to enhance liquidity and ensure overall market stability alongside efficiency
- Beta version of the X-Mobile (a dynamic and user-friendly mobile app) was launched to boost retail investors’ participation.
- Organising the first-ever Hackathon designed to encourage Tech enthusiasts to develop innovative Fintech solutions;
- Hosting two interactive sessions in the Insurance and Consumer Goods sectors;
- Organising the Fixed Income Trading Workshop to enhance the capacity of dealing members;
- Holding the inaugural edition of the Islamic Finance in Nigeria (IFN) Forum in partnership with REDmoney Group.
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- Listing of MTN Nigeria Communications Plc by introduction on the Premium Board
- Cross border listing of Airtel Africa on the Main Board, alongside London Stock Exchange
- SAHCO Plc listing by IPO on the mainboard
- Launch of the Greenwich Alpha ETF focused on tracking the NSE 30 index.
In its aspiration to become a more agile and demutualized exchange, and pursuant to the SEC’s ‘No Objection’ rule, The Exchange will proceed to the next steps which include seeking formal approval from its members on demutualization Scheme. While keeping an eye on the strategic intent post-demutualization, The Exchange commits to leveraging its vast network of stakeholders, in addition to developing new strategic partnerships to deliver better products and services to the investing public.