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More reactions are still trailing the declaration of incumbent President Muhammadu Buhari as the winner of 2019 presidential election on Wednesday as bearish equity traffic continued at the capital market for the third day on Thursday.
Otherwise, the news of his re-election tumbled rising fortunes to red as further profit taking by investors in the shares of leading stocks and equities pulled market capitalisation down by N85 billion on Tuesday and additional N85.6bn on Wednesday extending lull to Thursday, erasing the gains recorded in previous sessions before the elections.
The trending shocker is the banking stocks which recorded record slumped since June 2016, after the re-election of President Muhammadu Buhari.
An index of Nigeria’s 10 largest banking stocks dropped by 4.6 per cent at the end of trading on the floor of the Nigerian Stock Exchange on Thursday, while the country’s benchmark stocks index retreated for the third day.
Investors in the nation’s stock market lost a total of N365bn in the last three days of trading in February.
Business Hilights recalls that the equities market opened the month with a market value of N11.424tn, which rose to N12.200tn on February 15.
The market capitalisation, however, declined in the second half of the month by N371bn, 98.8 per cent of which was recorded this week following the announcement of the results of the presidential and National Assembly elections.
Yesterday, investors lost N195bn as 30 losers led by Oando Plc suppressed the gains recorded by nine stocks.
The All Share Index of the Nigerian Stock Exchange shed 1.63 per cent to close at 31,718.70 basis points on Thursday, while the year-to-date gain declined to 0.97 per cent.
Trouble in the capital market seems to have started as soon as the Independent National Electoral Commission (INEC), declared Buhari winner of the 2019 Presidential Election, beating leading businessmen pair of Atiku Abubukar and Peter Obi of the People’s Democratic Party (PDP) by a margin of 3,928,869 votes having polled 15,191,847 against PDP’s 11,262,978 votes.
Reviewing the sudden market performance in an interview in Lagos, a seasoned stock broker who pleaded anonymity said “The market is yet to see more shocks coming from the trending election results. To me, the cause of the negative shocks in the market stemmed from the fact that whereas both Nigerian and international market makers who saw Atiku’s pair with former Anambra State Governor, as business persons with clear cut views and plans for the economy during the presidential campaign period, up till now, many well informed Nigerians are yet to understand the economic policy direction of the incumbent.
The expert further decried that the seemingly loss in economic direction started to emerge since the former Minister of Finance, Mrs. kemi Adeosun left the Buhari cabinet unceremoniously.
The stock expert said “Up till now, market watchers cannot say this is the exact economic policy direction of the incumbent and throughout his campaign; there was no single document given out as possible development plan or how the acclaimed next level will go”.
“In all, the market reaction has a lot to do with confusion in investors’ confidence and such scenarios usually lead to high level of profit taking and to an annoying extent pullout from the economy by foreign investors.
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