Nigeria’s equities market extended gaining streak yesterday to a tune of N26 billion, riding on the new directive of the Central Bank of Nigeria (CBN) on opening a new foreign exchange window for investors.
The CBN had last week released a circular announcing the creation of a special forex window for exporters and foreign investors.
While stock investors recouped N193 billion on Monday, the profit was topped yesterday with another N26 billion, such that market capitalisation rose by 0.29 per cent to close at N8.934 trillion.
Similarly, the NSE All-Share Index (ASI) rose 0.28 per cent as it gained 71.82 basis points to close the session at 25,818.87 index points.
Although, market turnover was on the negative territory as both volume and value traded depreciated by 39.82 per cent and 55.1 per cent respectively, that did not impact on market breadth as 24 gaining stocks emerged against 12 declining ones while six others closed the session unchanged.
Analysts have described the ‘preferential’ window as a way of weakening the naira for foreign investors with a view to boosting foreign portfolio investment, as the step is expected to soften the forex scarcity challenge faced by foreign business transactions.
Consequently, the naira eased 18.3 per cent to 374.25 to the dollar for investors yesterday compared with the official interbank rate of 305.90 and black market rate of 385.
Measured by the level of foreign portfolio investment inflow into Nigeria, it will be noted that the confidence of foreign investors in the country is yet to be restored because of forex difficulties they faced on many occasions.