2020: Investors gain N8.21trn as NSE posts best result in 12 years

2020: Investors gain N8.21trn as NSE posts best result in 12 years

Amidst turbulent events that rocked the year 2020 to its very foundation, the Nigerian Stock Exchange (NSE) has posted a positive performance described as phenomenal by analysts in the country’s capital market.

Moving against the current of Coronavirus pandemic’s economic disruption, the civil unrest triggered by a ubiquitous protest in many parts of the country and other economic headwinds in 2020, Nigerian equity market recorded N8.21 trillion profit to close the year in the green territory.

Firstly, the record qualifies the NSE as the exchange with the best performance in 2020 and in respect of recent annual stance; the bourse set its highest bullish record in 12 years.

Specifically, the valuation of equity investment at the bourse hit N21.057 trillion consequent of the gain, while the NSE All-share Index (ASI), which tracks share price movements in the  market, hit highest point in 12 years since 2008, with equity prices appreciating by 50.03 per cent on the average, thus, closing at 40,270.72 basis points.

According to analysts, this feat in a year that many would easily consider most horrible given the ravaging Coronavirus pandemic, which broke very early in the year, was achieved on the back of a favourable Monetary Policy introduced by the Central Bank of Nigeria (CBN), particularly the low interest rate in fixed income instruments and recovering crude oil prices.

Other factors included the better-than-expected earnings from the listed companies in the face of COVID-19 lockdown and the discovery of vaccines that have driven the rally and supported the recovery despite the weak economic fundamentals and the prevailing recession.

“We cannot ignore the fact that the equity market was the only one offering rates above the country’s raging inflation as a critical factor,” said analysts at Investdata.