United
Capital Plc has predicted tough time for the Nigerian stock market in 2016 due
to the poor condition of the naira against dollar as well as the dwindling oil
prices.
United
Capital Plc in its 2016 outlook titled ‘a slippery path to recovery,
finding
the new equilibrium’ said the dominance of foreign participation in
the last 4 years has led to the market’s seamless reaction to global
shocks.
Group Chief Executive
Officer of United Capital Plc, Mrs. Oluwatoyin Sanni, said Nigerian equities is
in dire need of increased local participation.
According to her, market
volatility and sell pressure has been majorly driven by capital flight,
buttressing the need for increased local participation to insulate the domestic
market from external shocks and currency volatilities.
She believed that the
Central Bank of Nigeria’s disposition to foreign investors will be a key driver
of equities movement in 2016 as uncertainty around foreign exchange will
continue to impact market sentiment.
She stressed that oil price
trajectory will remain a key driver of equity market direction, saying “we
expect crude oil prices to trade lower in 2016, portending a downside to
Nigerian equities.”
Daily Trust
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