Equities May Recover 43% this Year
- By Kayode Ogunwale
- Published January 25th, 2010
- News
- Unrated
EQUITIES listed on the floor of the Nigeria Stocks Exchange (NSE) may rise by 43 per cent this year. According to CSL Stockbrokers Limited, Nigeria’s benchmark stock index may rise 43 per cent this year as bank shares gain.
The company said Nigeria’s economy may expand 6.5 per cent this year and forecast of seven per cent in 2011.
Mallam Kasimu Kurfi, managing director and chief executive office of APT Securities and Funds Limited, said with the current market performance, there is assurance that the market may recover 60 per cent of its lost this year. Meanwhile the market has already gained 6.8 per cent of its loss this year.
BusinessWorld Intelligence can reveal that most of the stocks listed on the exchange can be described as “penny stocks” as most of them are trading far below their intrinsic value. Strangely, despite their shrinking values, companies have been declaring appetising bonuses and dividends. This is what separates the Nigerian capital market from other markets. The fundamentals are very strong.
The Nigerian capital market has reflected the impact of the tightening in liquidity and the drying up of interbank lending on banks. The liquidity squeeze has constrained the market as many people who would have loved to take advantage of the low value of stocks cannot do so because of lack of funds.
However, the fundamentals of the market are still very strong as demonstrated by its listed companies’ strong dividend payout, earnings per share, bonuses, among others.
According to Dun & Bradstreet’s 2010 economic & risk outlook report, major emerging markets continue to experience rapid economic expansion and both the US and Europe have pulled out of recession.
However, the winding down of stimulus programmes around the globe, high unemployment and a continuation of subdued bank lending are likely to result in a slowdown during the course of 2010. Consequently, more than 60 countries around the world are expected to record lower output in real terms in 2010 than they did prior to the crisis. Those countries most closely integrated with the US economy in particular, are expected to continue to suffer from the effects of muted US demand, the report said.
Despite predicting a global slowdown, the D&B report forecasts positive economic growth at a global level and a promising outlook for Australia. World economic growth is expected to hit 2.0 per cent this year and 2.3 per cent in 2011. This comes on the back of estimates which indicate that the global economy contracted by 2.2 per cent in 2009.
The company said Nigeria’s economy may expand 6.5 per cent this year and forecast of seven per cent in 2011.
Mallam Kasimu Kurfi, managing director and chief executive office of APT Securities and Funds Limited, said with the current market performance, there is assurance that the market may recover 60 per cent of its lost this year. Meanwhile the market has already gained 6.8 per cent of its loss this year.
BusinessWorld Intelligence can reveal that most of the stocks listed on the exchange can be described as “penny stocks” as most of them are trading far below their intrinsic value. Strangely, despite their shrinking values, companies have been declaring appetising bonuses and dividends. This is what separates the Nigerian capital market from other markets. The fundamentals are very strong.
The Nigerian capital market has reflected the impact of the tightening in liquidity and the drying up of interbank lending on banks. The liquidity squeeze has constrained the market as many people who would have loved to take advantage of the low value of stocks cannot do so because of lack of funds.
However, the fundamentals of the market are still very strong as demonstrated by its listed companies’ strong dividend payout, earnings per share, bonuses, among others.
According to Dun & Bradstreet’s 2010 economic & risk outlook report, major emerging markets continue to experience rapid economic expansion and both the US and Europe have pulled out of recession.
However, the winding down of stimulus programmes around the globe, high unemployment and a continuation of subdued bank lending are likely to result in a slowdown during the course of 2010. Consequently, more than 60 countries around the world are expected to record lower output in real terms in 2010 than they did prior to the crisis. Those countries most closely integrated with the US economy in particular, are expected to continue to suffer from the effects of muted US demand, the report said.
Despite predicting a global slowdown, the D&B report forecasts positive economic growth at a global level and a promising outlook for Australia. World economic growth is expected to hit 2.0 per cent this year and 2.3 per cent in 2011. This comes on the back of estimates which indicate that the global economy contracted by 2.2 per cent in 2009.
