Share dealing on Nigeria's bourse fell to 203.45 billion naira ($1.04 billion) in June, down 9.8 percent from year ago, the stock exchange said on Friday, as foreign investors unnerved by a weaker naira currency cut exposure to equities. Investors had hoped for a sustained rally after smooth elections in March eased uncertainties about political risk in Africa's biggest economy. But worries over government finances as oil prices stay low and the continued slide in the naira have hit markets.
The stock exchange said the value of shares traded by foreign investors in June stood at 69.65 billion naira, down from 118 billion naira during the same period last year, as domestic investors picked up the slack. However, share dealing increased 39.8 percent month-on-month from 145.5 billion naira in May, as domestic buyers, with no currency issues took positions in June, the Nigerian Stock Exchange said in a report.
Nigeria's naira currency has continued to hit new lows on the unofficial parallel market after the central bank last month curbed access to importers of a wide range goods on the official interbank market. The central bank on Friday said at a meeting where it kept rates on hold at 13 percent, that it would not devalue the naira again, after it did it in November and pegged it in February, owing to its inflation impact, resisting calls from foreign investors who think past devaluation did not go far enough.
Nigeria's stock market, which has the second-biggest weighting after Kuwait on the MSCI frontier market index, dropped below a psychologically important level of 31,000 points last Wednesday after falling for 11 straight days. Sub-Saharan Africa's second biggest stock index closed down 0.4 percent on Friday, 13 percent lower than its 2015 peak on April 2. It had soared 12.2 percent in the two sessions after Muhammadu Buhari won a closely-fought presidential election. The index of Nigeria's top 10 consumer goods stocks declined 1.02 percent on Friday, weighing on the all-share index. Investors have been selling out of relatively liquid consumer goods, banking and oil stocks.