Market downturn: Capital market operators seek increased participation of intitustional investors

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LAGOS – The Association of Stockbroking Houses of Nigeria (ASHON) on Monday said that the increased participation of institutional investors in the nation’s bourse would ensure market stability.
Mr Emeka Madubuike, President ASHON, said this in an interview with the News Agency of Nigeria (NAN) in Lagos.
Madubuike said that the Federal Government should encourage Sovereign Wealth Fund (SWF), Pension Fund Administrators and Asset Management Corporation to increase their exposure in the market.
The ASHON boss said that contrary to other opinions, activities of institutional investors would minimise the persistent sell pressure at the exchange.
He said that the market would experience the desired stability with increased participation of institutional investors.
Madubuike said that the major challenge of the market stemmed from the over reliance on unsteady foreign investors.
According to him, institutional investors’ active involvement in the market would shore up the demand side of the market with its attendant stability.
He said that the developments in the international crude oil market and uncertainties in the nation’s polity would continue to hamper market growth and development.
Mallam Garba Kurfi, the Managing Director, APT Securities and Funds Ltd., said that the funds should be invested in good companies trading below their fair value.
Kurfi said that government should be committed to the development of the stock market to avoid dominance of foreign investors who could offload at any given time.
He said that retail investors should be encouraged to return to the market, stressing that shareholders of the three nationalised banks should be compensated by government to enhance their confidence in the market.
NAN reports that the All-Share Index last week lost 2,464.29 points or 7.42 per cent to close at 30,763.38 points against 33,228.29 points achieved in the previous week.
The market capitalisation also dipped by N814 billion or 7.42 per cent to close at N10.156 trillion compared with N10.970 trillion posted in the preceding week.
Transcorps topped the losers’ chart in percentage terms, dropping 23.56 per cent or 94 kobo to close at N3.05 per share.
Champion Breweries trailed with a loss of 22.40 per cent or N2 to close at N6.93, while Mansard Insurance lost 22.04 per cent or 82k to close at N2.90 per share.
On the other hand, E-Tranzact International Plc led the gainers’ table in percentage terms, appreciating by 15.38 per cent or 34k to close at N2.55 per share.
Airlines Services and Logistics followed with a gain of 9.70 per cent or 16k to close at N1.81, while Wema Bank appreciated by 5.26 per cent or 5k to close at N1 per share.
Overall, investors in the week under review bought 1.81 billion shares worth N28.92 billion in 20,677, compared with 1.526 billion shares valued at N24.99 billion exchanged in 21,344 deals in the preceding week.
The Financial Services sector led the week’s activity chart with 1.37 billion shares worth N13.78 billion traded in 11,742 deals.
The Consumer Goods industry followed with a turnover of 137.12 million shares worth N9.37 million transacted in 3,583 deals.
The third place was occupied by the Conglomerates sector with 93.13 million shares worth N567.17 million traded in 1,256 deals. (NAN)