Financial expert forsees stock market rebounding after 2019 polls

Prof. Uche Uwaleke

…As Stakeholders unveil strategies to deepen Nigeria’s debt market***

A financial expert, Prof. Uche Uwaleke, on Wednesday expressed optimism that the Nigerian stock market would rebound by the second quarter of 2019.

Uwaleke, Head of Banking and Finance Department, Nasarawa State University, Keffi, expressed the optimism in an interview with the News Agency of Nigeria (NAN) in Lagos while reacting to the persistent lull in the nation’s bourse.

He said that the equities market would rebound after the general elections beginning from second quarter of 2019.

Uwaleke noted that his optimism was based on reduced political risk, return of foreign investors, favourable oil price and strong fundamentals.

He said that investors should not panic but recognise that the stock market, like every other market, was prone to business cycles of up and down.

Uwaleke said that investors must be encouraged not to panic and be selling down but be patient and wait for the market to rebound possibly after the elections next year.

He said that the major reason for the downturn was the exit of foreign investors occasioned by political uncertainties ahead of 2019 general elections.

Uwaleke urged stockbrokers and registrars to ensure that they played by the rules of the game, providing honest advice to their clients on the best ways to weather the current storm.

He said that investors should invest in stocks with strong fundamentals, noting that banking stocks hold a lot of promises as many of them appear undervalued now.

“The likes of Stanbic IBTC, GTB, Zenith and FBN Holdings will drive that sector. Industrial sector will be lifted by Dangote Cement. I equally see Nestle and some other consumer goods doing well,” Uwaleke said.

The All-Share Index in October shed 300.10 points or 0.92 per cent to close at 32,466.27 compared with 32,766.37 achieved in September.

Similarly, the market capitalisation which opened at N11.962 trillion lost N110 billion or 0.92 per cent and closed at N11.852 trillion.

Meanwhile,  participants at the just-ended annual Bonds, Loans and Sukuk Nigeria Conference in Lagos have adduced critical steps required to deepen Nigeria’s debt market because of the central role they played in the deepening of financial markets.

They said on Wednesday in Lagos in a post-conference communique that it was time to put in place proper structures to ensure the development of a deep and expansive bonds, loans and derivatives market in Nigeria

The event, held on Nov. 6, at the Eko Convention Centre, was sponsored by Stanbic IBTC Bank, and brought together over 300 participants comprising government officials, corporates, Banks, fund managers, investors and advisors.

It is the premier event connecting fund raisers with lenders and investors active within the Nigerian capital market space.

The conference featured over 30 key industry speakers who shared views on local asset management, developments in the pensions and alternative asset management space and issues affecting institutional investors; as well as providing insights on the capital market strategies of leading sovereign, corporate and project companies.

The Chief Executive Officer, Stanbic IBTC Bank PLC, Demola Sogunle, said: “The bond market plays a central role in the deepening of financial markets not only for the diversity of products it offers the market but essentially its role in improving diversification of funding sources and increasing access to credit markets.

“It is therefore the right time to ensure that proper structures are in place to ensure the development of a deep and expansive bonds, loans and derivatives market in Nigeria.’’

He said that by throwing its weight behind the event, Stanbic IBTC hoped to trigger the inflow of foreign direct investment into Nigeria by highlighting the country’s huge potential and growth opportunities.

This, he said, was in line with the group’s tradition of facilitating must-attend forums where critical insights on the Nigerian economy and the opportunities therein were provided.

Sogunle noted that conference was growing in stature as a major platform to glean useful information on capital market developments, especially at a time that access to capital had become imperative for Nigeria in the wake of global market volatility.

The Executive Director, Stanbic IBTC Capital Ltd., Kobby Bentsi-Enchill, described the conference as a great platform for hearing from and networking with the industry key players in the Nigerian bonds and loans markets.

Moderating the session on “Diversifying financing options for repeat issuers and assessing the practicalities for first time issuers and issuances in new sectors”, he said the overall objective was to provide long-term financing for the country’s economic development.

He said that the development of an organised bond, loans and debt market would help to diversify investment options and boost economic activities in the country.

“Whether you are looking to become more involved in the Nigerian debt markets, or expand your existing business, the annual Bonds, Loans & Sukuk Nigeria Conference provides a prime opportunity for you to meet key market players and develop your knowledge,’’ Bentsi-Enchill added.

The Director-General, Debt Management Office, Patience Oniha, who spoke on “Understanding Islamic Finance: What are the Requirements, Processes and Benefits of Tapping into this Market’’, enumerated the impact of Islamic finance in the growth trajectory of many countries across the world.

While making a case to harness this very important source of funding, she also highlighted government’s key funding requirements and where the funds would come from and the role of government in delivering infrastructure projects.

Other speakers at the event included Senior Resident Representative in Nigeria, International Monetary Fund(IMF), Amine Mati and Acting Director-General, Securities and Exchange Commission of Nigeria, Mary Uduk.

The General Manager/Corporate Treasurer, MTN Nigeria, Ishmael Nwokocha; and Managing Director and Chief Executive Officer, Sigma Pensions Ltd., Dave Uduanu also spoke.

The forum had panel discussions which featured in-depth analysis of case studies, as well as examining Africa’s use of debt products, and what is required to sustain the continent’s growth story.

A panel session on “Bringing issuers and traders to the Nigerian bond markets: Boosting liquidity and trading volumes’’ featured as discussants; Mary Uduk, Vice-President, Financial Markets Dealers Association, Adetoun Dosunmu; and Head of Global Markets, Stanbic IBTC, Sam Ocheho.

It was moderated by Konrad Reuss, Managing Director, South Africa and Sub-Saharan Africa, S&P Global Ratings.

Other top-level institutions that participated in the conference, organised by the GFC Media Group, included Financial Derivatives Company Ltd, Debt Management Office Nigeria, International Monetary Fund (IMF), International Islamic Liquidity Management Corporation (IILM), Federal Ministry of Finance, Federal Ministry of Environment, Access Bank and Central Bank of Nigeria, amongst others.

Stanbic IBTC Holdings PLC is a member of Standard Bank Group, a full service financial services group with a clear focus on three main business pillars — Corporate and Investment Banking, Personal and Business Banking and Wealth Management.

Standard Bank Group is the largest African bank by assets and earnings. It is rooted in Africa with strategic representation in 20 countries on the African continent.

Standard Bank has been in operation for over 155 years and is focused on building first-class, on-the-ground financial services organisations in chosen countries in Africa and connecting other selected emerging markets to Africa and to each other, applying sector expertise, particularly in natural resources, power and infrastructure.