See The Negative Effect Of President Buhari's Delay In Appointing Cabinet members

See The Negative Effect Of President Buhari's Delay In Appointing Cabinet members

 

 

As reported by Punch..The delay by President Muhammadu Buhari in appointing ministers and other key officials as well as the lack of clear information about his government’s policy direction have been major deterrents to investment in the nation’s capital market.

Capital market analysts, who spoke to our correspondent on the recent performance of the market stressed that investors, especially foreigners, were unlikely to make significant investment in the market, if any at all until, they had a clear picture of the policy direction of the government.

As of Thursday, three weeks after the inauguration of the President on May 29, the value of equities listed on the Nigerian Stock Exchange had declined by N238bn or 2.04 per cent, while the NSE All-Share Index fell by 2.47 per cent or 849.87 basis points.

In 14 trading sessions post-inauguration, the stock market closed on a positive note on only five occasions and with marginal gains.

This, according to analysts, is due to the delay in the formation of the cabinet and lack of vital information about what the economy direction is going to look like, leaving investors uncertain about the what policies the government will implement. The situation is different from what happened immediately after the presidential election.

In the first trading session after the declaration of Buhari as the winner of the election, the value of stocks listed on the NSE rose by a historical 8.4 per cent or N904bn.

Asked if the delay in forming the cabinet and announcing key appointments had affected the performance of the market, a financial analyst at WSTC Financial Services Limited, Mr. Olutola Oni, said it surely had.

He explained that the investment climate had been to a large extent dampened by the fact that the enthusiasm by which people looked forward to the coming of the new government was suppressed by what they had seen the government do since it was inaugurated.