When President Buhari was announced
winner of the 2015 Presidential Elections on
March 31, 2015, the All Share Index recorded
what is now known as a “Bull-Hari” effect. It
recorded about 10 straight day of gains as
investors basked in the excitement of a
peaceful election and surprising acceptance
of defeat by President Goodluck Jonathan. On
the day the result was announced the marked
gained a whopping 8.3% and followed that
with another 3.9% gain.
Turn for the worse
Since then the stock market has recorded
months of volatility as investors continue to
be kept in the dark about the economic
policies of the government. Investors both
local and international have basically given
up on the economy fleeing Nigerian stocks.
The fall in oil prices, continued dithering by
the CBN on its forex policies, corruption
allegations against past governments,
bankrupt states, drop in GDP and rising
unemployment have all contributed to the
negative outlook placed on the Nigerian
economy thus damaging investor sentiments
further.
Resultant effect
This has now resulted in a massive loss of
value for the exchange. As at August 26th
Nigerian Stocks have lost a massive N2.46
trillion in value since President Buhari was
announced winner. From a market
capitalisation of N12.13 trillion on the second
of April 2015, it closed at N9.67 trillion
Wednesday August 26th 2015.
Sure, the president only assumed power May
29, 2015 but we believe the GEJ Government
basically turned lame duck since then. Even
at that the stock market has lost N1.89
trillion since May 29. It has not climbed
above N11.6 trillion since May 28, 2015.
No end in sight?
No one knows how soon things will reverse
or how worse this could get in the coming
months. For now the market is in dire need of
an economic direction from the government.
Despite the macro economic downturn being
experienced around the world, a firm course
of action from this Government will at least
provide a soft landing for the market to
bottom out.
