Monday, 27 June 2016

Stocks: Analysts Expect Cautious Trading This Week



Financial experts have said that trading in the Nigeria’s stock market this week will experience some level of reluctance.
This is coming after global bourses plummeted at last week’s close as the United Kingdom voted to leave the European Union. The move had triggered a negative sentiment among investors.

Notably, the Financial Times Stock Exchange Index and Shanghai Stock Exchange Composite Index declined 130 basis points and 278 basis points respective at week close.
While trading largely in the green for most part of the week, the Nigerian Stock Exchange receded into negative territory at week close.
Notwithstanding,  the NSE All-Share Index appreciated by 4.79 per cent for the week, putting year to date return at 7.01 per cent.
“Noting the emergence of risk-off sentiment across global markets following the Brexit decision, we expect cautious trading across market as investors seek safe havens,” analysts at Vetiva Capital Management Limited said in the firm’s weekly report.
On June 23, Britain voted to leave the EU in a 52 per cent to 48 per cent vote in favour of exit. The exit is expected to happen over the next two years. The decision has set in motion an unprecedented and unpredictable process that threatens a period of uncertainty for Britain, Europe and the global economy.
“Amidst renewed global uncertainty, we also expect the post-Brexit risk-off sentiment to dampen the current positive sentiment in the Nigerian market in the coming days as market participants continue to assess the overall impact of the decision,” the analysts maintained.


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