Nigeria now worst performing exchange in Africa

The Nigerian stock exchange (NSE) has become the worst performing stock exchange in Africa, and the third worst performing in the world, after China and Saudi Arabia.

After losing 1.2 trillion in the first eight trading days of 2016, Nigeria has only lost less than China and Saudi Arabia in the entire world.

Speaking at the NSE outlook for 2016 media conference, Oscar Onyema, chairman of the NSE, said he would have been bothered if Nigeria was not losing the way it was, adding that the NSE was reflecting the state of the economy.

Onyema, said the bourse could fund the deficit of the 2016 budget,revealing that the stock had notified the government of the problems with the economy.

“The exchange has informed the government that there is a problem, the government knows that there is a problem, I think that the way you approach the solution to a problem is multifaceted and we do not want to have any kneejerk reaction,” he said.

“If you look at what happen in China the government intervene and it did not succeed, in fact it created more panic, so we have to be careful in what we are asking for, there has to be appropriate analysis as to the best way to address fundamental issue, the market has to continue reflecting in what is going on in the economy

“Investors are voting with their monies, with the sell-down we’ve seen, people are trying to understand what the actual impact of this new policies that have just been rolled out.”

He added that although the market was overreacting, the government needs to clarify its policies to help investors make informed decisions.

“I think the market is overreacting and as people who take into full consideration, the potential impact, I think that we’d see some more pressure.

“People are also looking at our domestic issues, the fact is that market activity is still or was still 45 to 60 percent is driven by foreign investors, that have to convert money to naira in order to make investments.

“You’re going to see the impact if they do not feel that there’s credibility in the exchange rate if they have to make the conversion. We think that with government giving more clarity around the various policies that are coming out, people would have more data point for making investment decisions.

“Giving much clarity around the various policies that are coming out, people will have more data point for making investment decision.”