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Capital Market Operators Want Forex Stability as Naira Remains Stagnant...See Latest Exchange Rates

The value of the nation's currency, Naira, has remained stagnant compared to its foreign counterparts as some capital market operators demanded the stability and positive economic polices.
Some capital market operators on Monday said that the Nigerian stock market rebound would only be sustained with the stability in the foreign exchange system: and enhanced positive companies earnings.
They told the News Agency of Nigeria (NAN) in separate interviews in Lagos that  foreign exchange stability and positive economic polices, if sustained, would boost stock market performance.
Mr Sewa Wusu, Head Research, SCM Capital Ltd., said that stability around the foreign exchange challenges would be a strong impetus for market performance going forward.
Wusu added that the market liquidity would increase if the Central Bank of Nigeria (CBN) current foreign exchange policy drive was able to attract foreign participation in the market.
He said that  the bullish resurgence witnessed so far was due to the release of impressive first quarter results by major companies, especially the tier one banks.
Wusu said that results released by some of the banks were impressive in spite of the level of provisions made for non-performing loans.
“I think by and large the performance of the tier-1 banks are in tandem with expectations and that created the positive sentiments  in the market last week,” he said.
He explained that the performance of the market going would be dependent on the sustainability of earnings of companies and foreign exchange stability.
Mr Ambrose Omordion,  the Chief Operating Officer,  InvestData Ltd., said that more encouraging economic data and eventual passage of the much-awaited 2017 budget would improve market liquidity.
Omordion said good times were ahead for investors with relative peace and security in the Niger Delta region and stability in oil output.
He attributed the weak market response to the positive 2017 first numbers released in the market low liquidity in the market and the economy due to uncertainties surrounding non-passage of the 2017 budget.
“It is one month to mid-year and the National Assembly has yet to approve and subsequently present a clean copy of the year’s Appropriation Bill for ascent to the President,” Omordion said.
He said that the development was slowing down economic activities and implementation of the Federal Government Economic Recovery and Growth Plan (ERGP).
Omordion said low valuation in the market might trigger high demand for stocks, noting that investors should invest wisely using bids, offers and volume when taking decisions.
He explained that traders and  investors who understood the importance of combining fundamental and technical analysis in making investment decisions in  the stock market should take advantage of the present opportunities and position.
According to him, this will enhance their medium and long term gains.

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