Rock bottom prices of shares
TRANSACTIONS in equities on the floor of the Nigerian Stock Exchange (NSE) are set to take a new turn if fillers from operators in the market are anything to go by, as investors may soon begin to swoop on listed shares.

Trading had shown, from the beginning of last week, huge volume of transactions amid low prices of stocks in virtually all the subsectors, even as value of the twin market indicators, the market capitalisation and the All-Share Index continued  nose dived.

Investment experts said that the low prices of stock were one good-time investors needed to approach the market for equity purchasing so as to average their losses in the market.The marginal meltdown in the prices of shares is said to be the signal the market has been waiting for, as it has already entered its resistant level owing to the fact that the prices of stocks can no longer fall below their present price.

Price rise expected why the equities market remains a function of demand and supply. Whenever supplies outwit demand, the prices of shares are bound to fall, while the reverse is the case when it is the other way round. The gradual return of confidence to the market  is occasioned by the low prices of stocks coupled with the recent rise of turnover in the market. Market experts believe that prices of stocks are expected, against all odds, to rise.

Views on how the market can thrive again
The market as it stands today, judging by every permutation, would need the collective effort of the regulators, operators as well as investors to make the market thrive again.
A lot of public awareness is needed at this point in time because majority of investors have considered the stock market to be an anathema of sort, and are only waiting for an opportunity for activities to rebound for them to exit.

The situation that is likely to occur, as there are signs already, is that the market is heading towards stability, where lots of funds will be available for purchase of stocks.
The market needs to put in place a lot of incentives, like severe cost cutting measure, so as to put the market, which is said to be the barometer for measuring the growth and development of the economy on a sound footing again.

Effort by NSE to stabilise the stock market
Determined to deepen the value of the Stock Market, the NSE said that the Exchange had identified integrity, durable wealth creation and business development as a veritable tool to grow the market.

To this end, the exchange has concluded arrangement to come up with new products; Options and Derivatives, that will be traded on the market beginning from 2012. According to the Chief Executive Officer, Mr Oscar Onyema, the management of the Exchange has since coopted ten new members to bolster its oversight functions, adding that each inducted council member had subscribed to code of conduct for council members.

He listed the five asset class options to include exchange traded bonds; equity options; index options and derivatives and financial features. He noted that a lot of things needed to be considered for the industry to be ready for the introduction of the new products, adding that the exchange needed to hire options specialists to drive the products to fruition.

“Such specialists will gather necessary mechanism to drive the products and until I have such persons on board I can’t give you specific options, but my goal is that within two years we will be trading on the new products. Each of these options specialists has a market structure that will deepen each product,” Onyema said.

“Although not a listed company, we have adopted a new corporate governance posture which is compliant with our listing rules, Securities and Exchange Commission’s recently released Code of Corporate Governance for public companies, and international best practice in this important area,” he said. Speaking further on the drive to reposition the market for growth, the NSE CEO said the council approved another seven committees to oversee the various affairs of the exchange which he listed to include Audit; Demutualisation; Finance and General Purpose; Rules and Adjudication; Technology; Risk Management and Disciplinary.

Transactions in the week
Investment value on Monday continued to depreciate even as more highly capitalised stocks shed weight leading to further slide in market capitalisation by N7 billion.
20 companies depreciated in price compared to 17 that constituted the gainers chart.

Further review showed that the All-Share index fell by 25.07 basis points or 0.1 per cent from 20,311.51 recorded on Friday to 20,286.44 while market capitalisation dropped by N7 billion or 0.1 per cent from N6,391 trillion to N6,384 trillion.

Wema Bank, Cement Company of Northern Nigeria (CCNN) and Enterna Oil topped the day’s highest price loser with five per cent each to close at 57 kobo, N4.75 and N3.61 per share respectively while Dangote Flour followed with 4.92 per cent to close at N5.60 per share.

On the other hand, Forte Oil led others on the gainers chart with 4.93 per cent to close at N13.42 per share.  Honeywell Flour Mills Plc followed with 4.76 per cent to close at N3.08 per share while Airservice gained 4.74 per cent to close at N1.99 per share.

Activities on the NSE on Tuesday recorded a marginal rise as market capitalisation gained 3 billion or 0.05 per cent to close at 6.387 trillion while All Share Index (ASI) also gained 12.41 basis points or 0.0.6 per cent to close at 20,298.85 points.

A turnover of 193.8 million shares worth N1.490 billion in 3,533 deals was recorded in the day. The banking sub-sector of the financial services sector was the most active during the day (measured by turnover volume), with 106.2 million shares worth N829 million exchanged by investors in 1,830 deals. Volume in the banking sector was largely driven by activity in the shares of First Bank Plc, Access Bank Plc and Guaranty Trust Bank Plc. Also, Insurance sub-sector of the financial services sector,  was boosted by activity in the shares of Intercontinental Wapic Insurance Plc, N.E.M. Insurance Plc and Prestige Assurance Plc.

Dangote Cement Plc led  the gainers’ table with a gain of N0.90 kobo to close at N104.00.50 kobo per share while Forte Oil Plc followed with a gain of N0.67 kobo to close at N14.09 kobo per share and WAPCO Plc gained N0.50 kobo to close at N38.60 kobo per share.   Investors’ wealth on Wednesday continued on the downward note as losses by some highly capitalised stocks resulted in market indices depreciating by N71 billion.

Trading in the day was heavily driven by the huge transaction of 114.6 million ordinary shares of Access Bank valued at N553.9 million done by investors in 124 deals.

Consequently, market capitalisation fell by 1.11 per cent from N6, 387 trillion recorded on Tuesday to N6.316 trillion, while the All-share index dipped by 228.2 basis points or 1.12 per cent, from 20,298.85 to 20,070.63

Further review of the market activity in the day showed that while 26 stocks depreciated in price, 12 constituted the gainers chart.

GlaxoSmithKline Plc, Multi-Trex Plc and RT Briscoe emerged the highest price losers, shedding 5.00 per cent each to close the day at N25.65, N1.33 and N1.33 per share while UBA Plc which closed the day’s losers chart as the fourth on the roll and depreciated by 4.98 per cent to close at N2.67 per share.

However, Forte Oil Plc led others on the gainers table with 4.97 per cent rise to close at N14.79 per share, followed by Ecobank Nigeria Plc with 4.41 per cent rise to close at N2.13 per share. Other gainers in the day’s transactions include Premier Breweries of Nigeria Plc and Fidelity Bank Plc which rose 4.30 and 3.45 per cent to close at N0.97 and N1.50 per share. Activities on the floor of the Nigerian Stock Exchange on Thursday continued on bearish note as IBTC Bank Plc and Ikeja Hotel led other 29 losers to depreciate the market performance indices by 0.55 per cent.At the close of trading in the day, IBTC, Ikeja Hotel and UBA led the percentage losers’ chart with 5.00, 4.90 and 4.87 per cent each to close the day at N7.60, N2.91 and N2.54 respectively while UPL Plc followed with a loss of 4.86 to close at N3.52.

On the other hand, NCR Plc led the other six gainers with 4.97 per cent to close at N8.87. Cement Company of Northern Nigeria followed with a gain of 4.84 per cent to close at N4.98 while Guaranty Trust Assurance added 4.32 per cent to close at N1.45 per share.

Further review of trading in the day showed that, the All-share index shed 109.45 basis points or 0.55 per cent from 20,070.63 recorded on Wednesday to 19,961.18 while market capitalisation dropped by N35 billion or 0.55 per cent from N6,316 trillion to N6,281 trillion. Further analysis of the day’s transactions showed that the Banking sub-sector of the financial services sector buoyed by the activities in shares of First Bank and UBA Bank was the most active in terms of volume with a turnover of 40.7 million shares worth N280.5 billion in 557 deals. In terms of turnover in the days trading, the Beverage Brewers/Distiller subsector was the highest, with investors trading a total of 317.2 million ordinary shares of International Breweries Plc worth N1.9 billion swapped in 19 deals.  On the whole, investors exchanged 465.3 million shares worth N3.45 billion in 3,042 deals.

However, trading in the equities market closed the week on a positive note, as the twin market indicators, the All-Share Index and the market capitalisation rose by 0.8 per cent each to close at 20,122.14 basis points and N6.332 trillion.