Equities will deliver positive returns this year, says Amolegbe

• Published date: 16 January 2023
• Publication title: Nigeria - The Nation

Nigerian equities will continue on the upswing and deliver their fourth consecutive positive return this year, breaking its own records of anxious pre and post-elections cycles.

Former president of Chartered Institute of Stockbrokers (CIS), Mr Olatunde Amolegbe, said the stock market was poised for another positive return in 2023, after Nigerian equities netted net capital gain of N4.45 trillion in 2022, one of the highest returns globally.

Amolegbe, who is the Managing Director, Arthur Steven Asset Management, said most indicators and trends point towards another positive return for the Nigerian stock market.

The benchmark index for the Nigerian stock market closed 2022 with full-year average return of 19.98 per cent, equivalent to net capital gain of N4.455 trillion. This was the third consecutive year of a significant bullish run. Nigerian equities had closed 2021 with average return of 6.07 per cent, equivalent to net capital gains of N1.278 trillion. In the throes of the outbreak of COVID-19 pandemic in 2020, Nigerian equities had recorded average return of 50.03 per cent, representing net capital gains of N6.483 trillion.

Amolegbe, a Fellow of the CIS, noted that given the equities market's deviation from the election cycle norm of a negative close in pre-election and election years, as observed in the previous two election cycles, the Nigerian equities market remains on the upbeat to deliver a positive return in 2023.

He, however, said yields could fall in the fixed-income market given less preference for fixed income instruments by investors, although there could be some yield spikes as the Central Bank of Nigeria (CBN) goes on the offensive against rooftop inflation.

He described the year as one filled with brand new opportunities for growth and financial progress, pointing out that next month's general election that is expected to usher in a new government would play a significant role in determining the direction of the economy, among other macroeconomic factors.

'It is our hope that a smooth and safe transition should herald stability for the economy,' Amolegbe said.

According to him, there was no doubt that 2022 was a turbulent year for the global economy as well as the financial markets with the Ukraine-Russia war coupled with inflation and global supply chain issues dominating the minds of policy makers.

He assured the public that while teh year appears with its own uncertainties, Arthur Steven will continue to provide professional advisory services...