CONTRARY to the projection by analysts that the 2010 financial results of some quoted companies would lift the stock market to higher heights when they are released, the market continued on a downhill journey even with the release of impressive results by Guaranty Trust Bank Plc, Zenith Bank Plc, Access Bank Plc, among others. This has further diminished the expected growth in activities within the remaining part of first quarter which ends this week and even the second quarter. Analysts attribute the decline in stock prices and the lull in the market to fears over the outcome of the elections by foreign investors who have been the major drivers of the market for some time now.  Trading information available to BusinessWorld indicates that much of the transactions in the market are being conducted by foreign and institutional investors. It is believed that foreign investors now account for a larger share of transactions on the Nigerian Stock Exchange (NSE).
Surprisingly, stocks of the companies that posted the impressive results relapsed to  losses few days after the release of the results. Analysts said this was mainly as a result of lack of interest by the investors who do not believe that market capacity has returned fully after three years lull, indicating that the NSE and SEC may have failed in their effort to restore confidence in the market.
The year-to-date increase in the NSE All Share Index stood at 92.86 points or 0.37 per cent from 24,770.52 basis points it opened the year to close at 24,863.38 basis points as at the end of last week trading, while market capitalisation increased by N30.194 billion or 0.38 per cent from N7.914 trillion to close at N7.943 trillion. Market capitalisation had in January increased by 6.7 per cent over the December 2010 closing value while the decline in market capitalisation in February resulted in  the decline in the prices of most equities coupled with the delisting of one matured FGN Bond.
Also contributing to the decline in stock value is the election, as many analysts believe that foreign investors who are core investors in the market are standing out to see how the election will turn out.
Also, many believe that there was no clear cut signal on the relationship between the bailed-out banks, their prospective buyers and the fate of their shareholders. Just last week Union Bank of Nigeria Plc notified the exchange that it has executed a Memorandum of Agreement (MOA) with the African Capital Alliance Consortium, the core investor selected by the bank’s board of directors. The bank stated that it will within the next few days make a deal announcement to advise the bank’s stakeholders of the signing of the MOA.