Two key events took place last week at the Nigerian capital market which could as well serve as a pointer to what 2010 holds in stock for various players in the market.

The first event was the formal resumption of Arunma Oteh, the new director-general of the Securities and Exchange Commission (SEC), albeit after a long wait since her appointment was approved by the National Assembly.

The other good news happened to be the positive growth that was recorded in the equities sector (surprisingly in the first week of the year) with the market capitalisation closing at a high. Market operators are more optimistic about the Nigerian capital market improving than the previous year.

The performance of stocks in the top ten gainers class in the period were in the region of 22 per cent and 27 per cent price appreciation. In the banking sector, Oceanic Bank Plc, Bank PHB Plc and Afribank Plc, made the list of the top ten gainers with 25.99 per cent, 25.36 per cent and 24.28 per cent, respectively. The market trend shows that most of the stocks in the period outperformed the All-Share Index.

According to analysts at Proshare, “the surge recorded in the market performance in the last seven trading days might not be unconnected with the pronouncement from the CBN on the moves toward increasing liquidity situations in the economy, the fact that tension in the banking sector is being doused, the change in SEC leadership with the resumption of the new DG, promise from the regulators to lead a more transparent and more efficient capital market, US Export-Import Bank $1 billion loan support guarantees to 14 lenders bailed out by CBN, and most importantly, the present status of most of the value stocks which are trading at discount.”

As an investor, what would you rather have: a good year or a good decade? Forget the good year. Of course, you’d much prefer the good decade. The lesson? It’s better to think in terms of decades than single years (or, worse, quarters and months).

As we start a new decade, expectations are high and investors would like to put their money where their mouth is. For the new SEC DG, it is expected that she would work to bring confidence to the market.

“The shortlist of what she must do, according to Victor Ogiemwonyi, would include the quick and immediate implementation of the Dotun Sulaiman committee report, the sustained effort to cleanse the market, by quickly completing the efforts already started by Daisy Ekineh who was acting DG before she resumed.” It has also been suggested that Oteh should investigate and decide all cases of market manipulation of the recent past.

“This way, we can rid the market of bad news quickly and learn from the mistakes by making new rules that will ensure the infractions do not happen again. She should also work to strengthen industry trade groups that will act as market monitors and allow her to focus on the big picture,” Ogiemwonyi said.

Finally, stakeholders want the new DG to also learn quickly that regulators do not talk like politicians. They speak only when necessary