Capital market operators blame low patronage on economic uncertainties

Capital market operators on Monday attributed low liquidity, poor volume and apathy in the Nigerian Stock Exchange (NSE) to uncertainties in the nation’s economy.

They told our reporter in Lagos that economic uncertainties occasioned by non-passage of the 2017 Budget were affecting investors’ confidence in the market.

Mr Emeka Madubuike, the immediate past President, Association of Stockbroking Houses of Nigeria (ASHON), said that the stock market performance was a reflection of the nation’s economy.

Madubuike advised the Federal Government to address the defects in the economy to enable the market to move forward.

He said that uncertainties in the economy were negatively affecting the market, resulting in low volumes due to loss of confidence.

Madubuike said that non-passage of the 2017 Budget was also affecting the economy.

“Nobody knows the direction of the economy,” he told NAN, expressing dissatisfaction that the National Assembly had yet to pass the budget.

“Budgets are estimates; I wonder why there should be politics in passing a budget. Why should a budget take four months to be passed? “he asked.

Madubuike said that the government should urgently map out strategies to ensure refining of crude oil in the country to avoid payment of subsidies.

He said that the economy might not experience any meaningful development without the utilisation of the capital market for infrastructural development.

According to him, long-term projects should be financed through the capital market to develop the economy instead of government reliance on local and foreign borrowing.

“We might continue to run in circles if governments – federal and state – fail to source for funds through the capital market to finance long-term projects, “he told our reporter.

Madubuike said that the Federal Government should look for an alternative source of energy and have a stable supply to encourage companies.

Mr Ambrose Omordion, the Chief Operating Officer, InvestData Ltd., said that many investors and businessmen had expressed concern over the low liquidity in the market and the economy.

Omordion attributed the low liquidity to delay in passing the 2017 Budget.

He said that the low liquidity was militating against the confidence being rekindled by Nigerians in the economy.