When Buhari confirmed his intention to run for the presidency, the bears went on rampage at the Nigerian Stock exchange, NSE, with investors losing N150 billion on the run on the market. Since then, there has been a sustained run on the market, negating expectations from analysts who expected the market to pick after exiting recession. This was blamed on the political intrigues that followed hhis declaration and bank runs due to the local party primaries and the outlook for the big one. Since the past three months, however, a cumulative loss of N729 billion has been reported at the floor of the exchange.
Analysts tend to rationalize this, blaming it on extraneous factors that was not put into considerations. Political decisions often affect the market in addition to global macro and micro economic indices.
Investors are worried about what will happen in 2019 and prefers to move their investments to safe havens, or to adopt the wait and see games. The penchant fhat the presidency have for demarcating his own economy is also cited as a source of worry to the investors.
In 2016, after the initial hiccups of trying to determine the economic direction of the new government which made the market to decline by a whooping 26%, the market rallied in 2017, increasing market capitalization.to N4.5tr.
The current ward congresses going on in the country are resulting in liquidity squeeze This is due to tensions and violence associated with these elections, and it is expected to get worse during the major elections.Indications are that politicians are overheating the polity.
In an environment driven by foreign investors, where the locals are scared of investing, the pulse of the market is usually decided by the mood of foreign investors who have opted a siddon look approach to investing in the NSE.
The outlook looks dim with threats of violence by Mietta Allah Cattle Rearers association if Buhari loses.