The Nigerian equities market grew by N674 billion in a seven-month period ending July 2014, just as the market is moving towards a slower growth for the year.
While the market witnessed a major growth of over 47.3 per cent in the corresponding period of 2013, the market could only managed a growth of 5.1 per cent in 2014.
The market had opened the year with a value of N13.226 trillion and rose to N13.900 trillion as at the close of July last week. Also, the Nigerian Stock Exchange (NSE) All-Share Index, which is the benchmark gauge for the market rose marginally by 1.86 per cent. The ASI rose from 4,329.19 to 42,097.49.
While the market capitalisation rose by 5.1 per cent, the ASI grew by a mere 1.86 per cent due to listing of new companies. Prominent among them is Seplat Petroleum Development Company Plc. The company's shares were listed at N576, which have since appreciated to N659.38 per share last week.
Market operators had, at the beginning of the year, expressed confidence that the market would record another positive performance this year. However, a review of the performance in the last seven months has shown that those expectations may not be met.
Although the market hit a new peak in July 9, helped by speculations for improved second quarter results by companies, the market began a slide as many of the results were below expectations.
The NSE ASI climbed to 43, 039.42 on July 9 on the expectations for high half year corporate announcements. However, it slid back below the 43,000 levels as the corporate results were below expectations.
Many of the banks, for instance, have reported weaker bottom-lines. Also, some leading manufacturing like Unilever Nigeria Plc, Flour Mills of Nigeria Plc declared lower profits for the reporting period.
With little assurance of major turnaround in the fortunes of many of the listed firms, especially in the banking sector, some operators believe the growth recorded in 2013 may not be achieved this year. They however noted that the market will not end with a negative performance, saying that the growth might only be marginal.
The Chief Executive Officer of Chief Executive Officer, Lambert Trust and Investment Limited, Mr. David Adonri, said it is not likely that the performance this year can match the performance of the last two years "because those years were the recovery years after the financial crisis in the market,"
He assured that the year 2014 could still be positive for the NSE slow growth, noting that the market was moving in the right direction by avoiding another crisis.