The Nigerian Stock Exchange (NSE) remains attractive in terms of dividend yield and market valuation ratios, with the All Share Index outperforming peer exchanges in Africa.
This was revealed by the Chief Executive Officer, NSE, Oscar N. Onyema during the Stakeholder Engagement Series which held on Wednesday May 27, 2020.
Highlighting NSE’s performance so far in 2020, Onyema said, “Supported by recovering oil prices, resumption of economic activities and attractive valuations, we have seen the NSE ASI rally from -20.6percent in March to -6.1percent return Year-to-Date.”
“This is particularly noteworthy when compared to other leading African Exchanges including the JSE/FTSE ASI (-13.1percent); Nairobi ASI (-15.6percent); and BRVM Composite (-17.5percent); EGX 30 ( -27.6percent). We have also experienced increased activity from domestic investors who currently represent 59 percent of equity value traded for the first time in ten years, as well as from retail participants who are taking advantage of low valuations and high dividends,” he said.
Looking at other asset classes, Onyema reported that the market capitalisation in the fixed income space has risen by 8.91percent to N14.02trillion ($36.32billion) from N12.92trillion ($35.44billion) as at the end of 2019 as a result of increased listing activity from the Federal Government and Nigerian corporates.
While the ETF market has seen mixed sentiments from investors owing to activities in the equities market. Of the ten listed ETFs, The Exchange reports significant returns in the New Gold ETF with a 48.94percent return year to date (YtD) and the VETIVA S&P NIGERIA SOVEREIGN BOND ETF with 16.28percent return YTD.
Speaking to the resilience of the capital market, the Acting Director General, Securities and Exchange Commission (SEC), Mary Uduk, represented by Okey Umeano, Head, Office of the Chief Economist at the SEC said, “We are proud to report that our market continues to function seamlessly and perform positively during this pandemic. As the regulator of the market, we recognize that Covid-19 has ushered us into a new normal that is here to stay, and we are committed to performing our activities in the best possible way to make the Nigerian capital market attractive and responsive.”
The virtual session provided a platform for Onyema to engage with existing and potential domestic and foreign investors in Nigeria’s capital market in line with The Exchange’s commitment to promote market development.