News Column

Stock Market Plummets, Loses N187 Billion

February 21, 2014

Kayode Ekundayo and Kayode Ogunwale

The Nigeria Stock Exchange closed yesterday with a loss of N187 billion, following the suspension of CBN governor Sanusi Lamido Sanusi.

The market had opened at N12.655 trillion, but dropped 1.5 per cent to close at N12.468 trillion. This was the first fall by the market this week.

An economist and financial analyst, Aruna Kebira, said Sanusi's suspension sent a negative signal to the capital market.

"For the capital market, definitely there will be a negative reaction from foreign investors. They will sell and watch which direction our economy will toe after the exit of Sanusi," he said.

Economist Opeyemi Agbaje also said the economy will react negatively to the suspension of the CBN governor. He said appointing Sarah Alade as acting governor may stabilise the money market for a while pending when the new governor will assume office.

"The cost of sacking the governor will be too much for the nation's economy to bear than leaving him to complete his term which ends in three months' time," he said.

"I'm not impressed with the sack and the market will definitely react to this in a very strong and negative way. The timing is not right."

Director general, Lagos Chamber of Commerce and Industry, Muda Yusuf, described the sack of Sanusi as unexpected and came at a wrong time. "The president should have allowed him to complete it instead of turning the whole nation's economy into confusion," he said.

"It is difficult to ignore the consequences of non-remittance of revenue of kerosene saga. Sanusi had made a profound statement of non-remittance of the revenue to government's purse which is yet to be cleared. So the consequence is very great because we are dealing with issue of probity and it has a way of sending wrong signals to investors."

For more stories on investments and markets, please see HispanicBusiness' Finance Channel

Source: AllAfrica

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