Mr. Onyema in a presentation tagged “restoring market confidence in an era of economic uncertainty: challenges and prospects” at the Business Hallmark & the Nigerian Stock Exchange Public Policy Forum held in Lagos Thursday outlined a number of measure the NSE and the government will take to restore the lost glory in Nigeria’s capital market.
The NSE had been pathetically bearish since the shocks of the global financial meltdown and it hasn’t recovered just yet. He segmented the market recovery roadmap into two. One dealt with NSE
initiatives while the second dealt with government backed initiatives.
On the NSE initiatives he said, include, industry classification, market cap definition, Income vs. growth stocks; company share buyback; address demand side and enable optimal capital structure and investor clinics –using market segmentation as basis for portfolio construction.
Other measures include, introduction of First ETF in Nigeria, market making, scurrilities and short selling, market efficiency and new trading opportunities, among others.
On the proposed government-backed initiatives, the NSE CEO said include; review of PFA Asset allocation policy because it has opportunities for biggest buy-side institutions in the market and biggest pool of long-term capital, which can be channeled into capital formation.
He also said there would be a new policy to deepen the capital market and high capitalization companies in specialized sectors. The NSE CEO also said government would evolve policies encouraging
large firms in Telecom, E&P, Power, and Agriculture to come to the market for funding.
he also noted that the launch of the Sovereign Wealth Fund will create a buffer for market volatility by foreign portfolio investors.
He called for the review of exit strategy from privatized government entities and called for Simultaneous listing of entities earmarked for privatization among others.
He said the implementation of the planned NSE initiatives and proposed government-backed initiatives should rekindle investor confidence and unlock the potential for financing Nigeria’s vibrant economy.