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Financial experts seek fiscal incentives for stock market rebound

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Some financial experts on Monday urged the Federal Government to introduce fiscal incentives to encourage new listings on the Nigerian Stock Exchange (NSE).

The experts, who spoke with the News Agency of Nigeria (NAN) in Lagos on ways to restore investors’ confidence in the market, said the introduction of fiscal incentives such as tax holiday was paramount.

The Head of Banking and Finance Department, Nasarawa State University, Keffi, Dr Uche Uwaleke, said that government should consider incentives to encourage new listings.

Uwaleke said that the Central Bank of Nigeria (CBN) should consider monetary policy easing for the market to rebound.

“The CBN should consider easing monetary policy by reducing MPR as high interest rates have only increased yields on government securities and sharpened investors’ appetite to the detriment of equity investments,’’ he said.

According to him, the planned borrowings by the government should be invested in infrastructure and employment generating sectors.

Uwaleke called for the speedy implementation of the 2017 budget, adding that local contractors should be paid promptly to improve liquidity in the system.

“All these will complement the current efforts of the regulatory authorities at restoring investors’ confidence,’’ he said.

The Chief Operating Officer, InvestData Ltd., Mr Ambrose Omordion, urged government to pursue more friendly investment policies in 2017 to boost investors’ confidence.

Omordion attributed the present market trend to investors’ reactions to November OPEC meeting which impacted positively on petroleum stocks.

He, however, said that the bull transition due to end of the year seasonal trading pattern would likely slow down this week with profit taking.

Omordion said that investors should combine technical and fundamental analysis before investing in the market.

NAN reports that the NSE All-Share Index last week appreciated by 889.41 points or 3.44 per cent to close at 26,707.10 compared with 25,817.69 achieved in the preceding week.

Also, the market capitalisation which opened for the week at N8.883 trillion inched N306 billion or 3.44 per cent to close at N9.189 trillion.

Honeywell Flourmills led the gainers’ table in percentage terms, appreciating by 24.53 per cent or 0.26k to close at N1.32 per share.

Ecobank Transnational came second with a growth of 21.13 per cent or N2.10 to close at N12.04 and Seplat improved by 20.59 per cent or N70 to close at N410 per share.

United Capital rose 11.92 per cent or 0.31k to close at N2.91, while Livestock Feeds appreciated by 11. 54 per cent or 0.09k to close at 0.87k per share.

Conversely, Portland Paints led the losers’ table in percentage terms, dropping by 13.54 per cent or 0.31k to close at N1.98 per share.

Unilever Nigeria trailed with a loss of 12.07 per cent or N5.43 to close at N39.57 and Fidson dipped 8.63 per cent or 0.12k to close at N1.27 per share.

Caverton lost 8.51 per cent or 0.08k to close at 0.86k, while Mobil Oil dropped 8.20 per cent or N25 to close at N280 per share.

Meanwhile, a turnover of 1.66 billion shares worth N12.58 billion were traded by investors in 12,860 deals.

This was against the 894.76 million shares valued at N10.63 billion which exchanged hands in 13,418 deals in the preceding week.

A breakdown of the week’s activity chart showed that the Financial Services Industry led the activity chart with 1.504 billion shares valued at N6.183 billion traded in 7,311 deals.

The Consumer Goods sector followed with a turnover of 51.39 million shares worth N4.753 billion achieved in 2,027 deals.

The third place was occupied by the Conglomerates sector with a total of 46.28 million shares worth N52.41 million in 553 deals. (NAN)

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