Saturday, 28 March 2015 01:29
LAGOS: Nigerian stocks climbed for the sixth straight session on Friday, as domestic investors snapped up shares betting a presidential election due on Saturday would go smoothly.
Frontrunners President Goodluck Jonathan and former military ruler Muhammadu Buhari are facing off in a contest many think is too close to call.
Africa’s biggest economy delayed the vote by six-weeks to March 28, citing security concerns, sending financial markets into a tailspin.
The naira fell through a psychological level of 200 to the dollar for the first time as foreign investors fled.
Analysts said concerns among investors that the elections could be delayed further, triggering a constitutional crisis that would unsettle markets further, had dissipated.
“The equity market rallied before Saturday’s presidential election amidst sustained demand for large caps.
If presidential election is successfully held, we expect the rally to continue,” analysts at Vetiva Capital said. Brokers said local investors mostly pension funds were taking positions as strong earnings, especially in the banking sector, could signal renewed buying if the vote goes smoothly.
President Jonathan warned against violence ahead of the vote as people stockpiled food, cash and fuel for fear of post-election clashes.
Foreign investors, who account for bulk of transactions on the bourse are waiting on the sidelines, brokers said.
The all-share index rose 1.6 percent on the day, and advanced 4 percent over the six days of gains. However, the index is down 13 percent so far this year.
The index of Nigeria’s top 10 lenders rose nearly 4 percent on Friday.
The naira has lost almost 20 percent since October, adding a currency risk for foreign players, who sold off 133 billion naira ($ 668 million) in stocks for the first two months of the year, partly hurt by a weaker currency.
Copyright Reuters, 2015
