Foreign Investors Chase Low Priced Shares At NSE

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Some capital market operators on Tuesday said that foreign investors were taking advantage of the low priced equities to re-access the Nigerian Stock Exchange (NSE).

They said in Lagos that the foreign investors were increasing their stakes in some of the highly capitalised companies.

According to them, foreign investors’ re-entry in the exchange would not only improve market liquidity, but would crowd out most of the local retail investors.

Mr Wale Onigbode, the Managing Director of Calyx Securities Ltd., said that foreign investors’ aggressive demand for Nigerian equities was triggered by lower share prices and the effect of market correction on local investors.

Onigbode said that positive merger discussions between Dangote Flour and Tiger Brands also contributed to the increased level of activities at the exchange.

He said that the liquidity challenges of the market and the mobile nature of foreign investors made the current market rally a fluke.

Malam Garba Kurfi, the Chief Executive of APT Securities and Funds Ltd., said that the positive results from some quoted companies had continued to impact on the quoted companies’ shares prices in recent weeks.

Kurfi said also that investors’ interim dividend expectation from some companies in the third quarter was another drive of the market.

Mr Eugene Ezenwa, the Managing Director of Pac Securities Ltd., said that the confidence building in the market should be taken more serious by the regulators.

Ezenwa said that movement of funds from the market into fixed securities would continue if the interest and inflation rates remained on a double digit.

Meanwhile, the All-Share Index last week rose by 511.34 points or 2.4 per cent to close at 22,110.91 points as against opening index of 21,599.57 points.

The market capitalisation also appreciated by N164 billion or 2.38 per cent to close at N7.059 trillion in contrast with N6.895 trillion it opened for the week.