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Value of Trading Declines 41% on Nigerian Bourse in 2016



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  • Value of Trading Declines 41% on Nigerian Bourse in 2016

Investors staked N557.75 billion on 78.90 billion shares in 2016, showing a decline of 41.33 per cent compared with N950.66 billion invested in 92.83 billion shares in 2015.

The market closed the year with a decline of 6.17 per cent, the third straight negative performance as a result of weakened investors’ appetite given several headwinds that pervaded the different sectors of economy in the year.

Assessing the performance of the market in 2016, analysts at Meristem Securities Limited said participation in the market was weak, as the volume traded and market turnover for the year pared by 15 per cent (78.90 billion units in 2016 versus 92.83 billion units in 2015) and 41.33 per cent (N557.75 billion in 2016 versus N950.66 billion in 2015) respectively.

According to MSL, 30 counters featured on the gainers’ chart, while, 77 stocks declined in the year. Dangote Flour (276.11 per cent), United Capital Plc( (108.40 per cent), Total (103.39 per cent), Seplat (87.19 per cent) and Mobil Oil (74.38 per cent) recorded the highest returns in the year.

Conversely, Forte Oil (-74.42 per cent), Skye Bank (-68.35 per cent), Caverton (-63.56 per cent), Diamond Bank (-61.74 per cent) and Sterling Bank (-58.47 per cent) were the top underperformers for the year.

The analysts explained that activities in the market were tempered during the year, as evidenced by the decline in volume traded and market turnover.

“We attribute this dull mood to weakened investors’ appetite given several headwinds that pervaded the different sectors of economy in the year. The weak investor sentiment was also compounded by the attractive interest rate environment in the year amid the rising inflationary pressure, which made fixed income investments a safe haven for investors,” they said.

Looking ahead, MSL said they expect a spillover of these sentiments into the first half of 2017.

“We expect a spillover of these sentiments into the first half of 2017, on the back of sustained gloomy state of the economy, as FX pressure continues to plague companies. We, however, do not rule out the possibility of a positive return in 2017, as we expect the higher crude production and price stability, coupled with effective execution of 2017 budget, to bode well for the Nigerian economy in the coming year,” they said.

In their sectoral review, MSL said the agriculture sector led the outperformers. According to the firm, the Meri-Agri Index returned 26.45 per cent to outperform other sectors in the market for the second year consecutively.

“The sector’s positive performance was steered by the usual suspects- Okomu Oil Palm Plc (+32.57 per cent) and Presco Plc (+21.52 per cent), while Livestock Feeds Plc (36.84 per cent) depreciated in value for the year. Other counters (Ellah Lakes Plc and FTN Cocoa) traded flat throughout the year,” they said.

MSL explained that the agric sector which contributes about 29 per cent to the country’s gross domestic product (GDP) was amongst the few to record positive output growth (+4.54 per cent ) as at Q3:2016.

“We attribute this to heightened government focus, coupled with the favourable policies which were implemented in the course of the year. Also, as evident from the earnings releases of the companies, the devaluation of the Naira which is stifling activities of palm oil importers, resulted in a topline boost for Okomu Oil and Presco,” they said.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade experience in the global financial markets.


London Real Estate Company for African Investors Announces its Launch   



London Real Estate Company for African Investors Announces its Launch

 Wetherby Real Estate, which has been created to source and acquire luxury Serviced Accommodation in Prime Central London on behalf of global investors, has announced its launch. It will be specialising in investment opportunities for High Net Worth individuals from the African continent, although its service is open to investors from all over the world.

The business has been launched by Barbara Chanakira, founder and CEO of the Mayfair based Eaton Property Consultants, another acquisition service but one which purchases a range of residential assets for HNWIs. She has almost 15 years’ experience in the luxury residential sector, overseeing huge property portfolios for HNWIs from across the globe which include those of Gulf State Royal Families and high-profile celebrities.

Wetherby will be operating exclusively in one of Europe’s fastest growing residential classes, Serviced Accommodation. It will only acquire real estate in Prime Central London and tap into huge demand from a global investment audience, which has grown significantly over the last few years as the U.K’s Serviced Accommodation market continues to flourish. Wetherby considers PCL to be one of the globe’s safest and most lucrative investment destinations.

The company is registered in Gibraltar but will be operating out of its London headquarters. Investments are made through the company’s affiliated wealth managers and an FCA regulated Custodian, and Wetherby completes the real estate acquisitions through its UK-incorporated Special Purpose Vehicle. It has already identified a number of attractive prospects in London’s prime postcodes and it plans to expand into other real estate sectors in the future.

Chanakira will be joined by Simon Hall and Augustina Ogbebor, who bring a combined total of over 35 years of experience in investment and advisory services and will be occupying the roles of Non-Executive Director and Head of Investor Relations, respectively.

Hall has over 20 years’ experience advising HNWIs and global corporations on growth and investments, working closely with international developments banks and clients within emerging markets.

Ogbebor’s 16 years in investment banking has seen her work with the likes of JP Morgan, Deutsche Bank, Macquarie and Lotus Capital Ltd; one of Nigeria’s most prestigious fund managers and where she was head of business development.

 Barbara Chanakira, CEO of Wetherby Real Estate Ltd, said:

“London’s Serviced Accommodation market has an extremely bright future ahead, which has been compounded by changes taking place in the economy and society more broadly. The ongoing influence of Covid 19 has meant that lower operating costs, better social distancing and self catering benefits have enhanced its appeal, whilst the evolution of an increasingly transient workforce puts the sector in poll position to build upon its rapid growth of the last few years.

 London has an immovable social, cultural and economic appeal, and our intricate knowledge of its luxury real estate market as well as our carefully designed investment structure makes for an extremely attractive proposition. We have already identified a number of attractive opportunities and look forward to offering them to our network of investors from Africa and beyond.”

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2021’s Major Investment Risks – but Why it Could be a Year of Massive Opportunity




Investment headwinds will “still exceed the tailwinds” in 2021 – but there could be more “major opportunities now than in perhaps the last 10 years” if you know where to look.

This is the bold and, given 2020, perhaps surprisingly optimistic forecast from Nigel Green, chief executive and founder of deVere Group, one of the world’s largest independent financial advisory and fintech organisations.

It comes as investors around the world focus on rebalancing portfolios for 2021, after a year no-one expected.

Mr Green says: “2020 was a year for which nobody had planned.

“This included investors, many of whom were caught spectacularly off-guard by not having properly diversified portfolios, which left them open to untold financial risks.

“Looking ahead to 2021, it is likely that investment headwinds will still exceed the tailwinds – but, I believe, that there are also more major investment opportunities to be had in the next year than perhaps in the last decade.”

‘Headwinds’ are the factors that likely weigh on growth and returns, and ‘tailwinds’ are those that can be expected to boost growth and help drive positive returns.

He continues: “The major long-term headwind from the fallout of 2020 is unemployment, which will hit demand, growth and investment.

“There’s also the roll-out of a mass global vaccination agenda which will be a lengthy process and logistical minefield, plus there are the ‘vaccine sceptic’ concerns to address.

“Meanwhile there are geopolitical issues that could impact on investor returns. These include the significant readjustment that will need to happen following Brexit, U.S.-China trade relations which are likely to become increasingly competitive especially in the tech sector, and the rising border tensions between India and China, amongst others.”

However, despite the significant headwinds, the deVere CEO flags three major investment tailwinds in 2021.

“First, the rollout of the Covid vaccines which means economies can be expected to begin solid recoveries,” he says.

“Second, President-elect Joe Biden will enter office and his administration promises a more predictable approach to trade and foreign affairs – and the markets like certainty.

“And third, it is likely that governments will continue to offer fiscal support packages as their economies recover from the pandemic, offering a ‘floor’ for markets.”

Mr Green goes on to add: “To quote Einstein, ‘In the midst of every crisis, lies great opportunity.’

“This is why, after such a monumental crisis, I believe that if you know where to look and act appropriately to build your wealth, there could be plenty of key opportunities to come.

“The pandemic has accelerated history, speeding up and exacerbating major trends in just a few months, that ordinarily might have taken decades to be fully realised.”

He maintains that the global economy, how we live, do business and interact remains fundamentally changed.  “It is doubtful the world will go back exactly to how it was pre-Covid – there are many aspects of the ‘new normal’ which people like and support, just a home working.  As such, some of the major shifts are unlikely to be reversed,” he notes.

“As such, investors need to look for the lower entry points of quality companies to top-up their portfolios and, critically, they need to bear in mind how the world has changed.

“Their portfolios must reflect the future, not the past.”

Mr Green concludes: “Headwinds will surpass tailwinds in 2021 as the world readjusts, but it’s essential that investors stay invested. As we know, history has shown us that stock markets tend to go up over the long-term.

“But as the world moves ahead to a post-pandemic era, it’s crucial that investors ensure their portfolios are suitably diversified across asset classes, sectors, currencies and regions, so as to make the most of the considerable opportunities that will inevitably present themselves.”

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Global Deal Activity Down by 4.5% in October 2020



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A total of 6,304 deals were announced globally during October 2020, which is a decrease of 4.5% over the 6,598 deals announced during September, according to GlobalData, a leading data, and analytics company. An analysis of GlobalData’s Financial Deals Database revealed that the deal volume during October remained below the monthly average of Q3 2020.

Aurojyoti Bose, the Lead Analyst at GlobalData, comments: “After demonstrating growth for four consecutive months, the deal volume shrank in October. The decline in deal activity could be attributed to inconsistencies across different regions. The APAC region remained a weak spot, while deal activity remained mostly flat in North America, and the Middle East and Africa (MEA) region witnessed growth in deal activity.”

North America attracted the highest number of investments, followed by APAC, Europe, the MEA, and South, and Central America.

The uncertain global economic landscape lowered the deal volume in October for major markets such as the US, Germany, Australia, France, India, and China compared to the previous month. On the contrary, the UK, Japan, South Korea, and Canada saw growth of 15.6%,14.9%, 3.8%, and 2.2%, respectively, in October as compared to September’s deal volume.

Bose continued: “Most of the deal types witnessed a decline in volume during October compared to the previous month. Private equity, equity offerings, venture financing, debt offerings, and partnership deals volume decreased by a respective 2.4%, 9.1%, 9.8%, 14.6%, and 24.6% – while the deal volume for mergers and acquisitions (M&A) increased by 7.2%.”

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