Last week, Nigerian stocks fell by 1.2 per cent, marking its third week of broad retreat in the wake of the introduction of a T+1 settlement cycle in June.
The Banking Index was worst hit, receding by 10.5 per cent, followed by the Insurance Index. FTSE Russell, a global provider of stock market indexes, during the week placed its recent upgrade of Nigeria from unclassified to a frontier market on hold on fears that the country’s new rule, compelling international investors to prefund their accounts before transactions, may be deterring.
Failure by stock market authorities to respond swiftly to address the issue may leave stocks hammered further by apathy and capital flight from foreign investors.
This week, increased positioning, notably in stocks that pay dividends at least twice a year, could be witnessed as the market awaits the release of half-year corporate results.
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