Key Takeaways From The Nigeria Stock Exchange 2016 Review/2017 Outlook
The Nigerian Stock Exchange (NSE) yesterday held its 2016 review/2017 Outlook.
The event was a forum for the management of the NSE to brief analysts, stock brokers and the media on its activities. In general, the NSE retains a cautiously optimistic outlook for the year. For the retail investor, here are the following key points to note.
1. Short selling is now available to retail investors. The service had previously been available for institutional investors, who did not show much enthusiasm. Short selling means selling borrowed shares to pay back later. The motive being to sell high and then buying those stocks at a cheaper price to return to the lender.
- New products will be introduced to the market this year. Examples include the newly launched federal government green bond and a federal government savings bond.
- There will be a comprehensive review of the market makers programme within the year to enhance its effectiveness.
- The NSE intends to work closely with the government on its ten-point agenda for economic reform. It worked closely with the government in developing the recently announced whistle blower platform.
- Rules regarding sustainability report for companies will come into effect later this year. The NSE has published its sustainability report for three years running.
- Engagement with companies before releasing their results will be maintained, as well as stiffer penalties for late submission of results.
- The exchange has a project team that is working closely with MTN on its listing.
- A project team is also working to see how the NSE can help raise finance for the mining sector
- The project team on the West African Capital Market Integration (WACMI) is still on course. Phase 1 has been concluded, so investors can ask their brokers to place orders for shares across other African countries. Efforts to conclude phase two, whereby investors can buy directly stocks of other countries on the Nigerian floor are in the works, once integration with francophone countries is concluded
- The demutualization process is still ongoing. Issues regarding the membership list have been sorted out.