People in the stock market have asked the candidates for the 2023 election to talk about issues instead of violence in their campaigns. This will make the stock market more stable and bring more money into the stock market.
Foreign investors are important to the long-term health of the market, said operators. This is because a report from the Nigerian Exchange Limited (NGX) Domestic and Overseas Portfolio Investment (FPI) in July 2022 found that domestic investors were more active on the market than their foreign counterparts.
According to the report, during the first seven months of 2022, the total domestic investor transactions (TDIT) on the stock market went up by N1.490 trillion. On the other hand, N273.16 billion more was spent by international investors.
It also showed that international transactions were worth only N435 billion while domestic transactions were worth N1.465 trillion until July 2021. More than 77% of all NGX trades took place in the country in 2021.
Taiwo Oderinde, president of the Constant Shareholders Association, has noticed that the political climate is worsening. He said that if a crisis happened during the election campaigns, it would cause a lot of fear in the market.
He thinks investors are worried about the political risk of general elections. This is because investors and traders tend to wait and see in the year before an election.
Oderinde says these are signs that the country’s next election will be full of violence, uncertainty, and the unknown.
He said, “Politicians are responsible for the problems they are facing now. They must remember the commitments they offered to the public.” They need to talk about the issues in the campaign and stay away from violence.
Analysts at CardinalStone Partners Limited have warned that the next election in 2023 could scare away foreign investors. They mentioned in their mid-year 2022 forecast that the number of currency changes made on the official market this year will be limited by worries about the upcoming election year and fears of bad inflation pass-through.
They say foreign investors didn’t see much reason to invest money into Nigeria in the first half of 22. This is true of both emerging and frontier economies. Adebayo Adeleke, a former secretary general of the Independent Shareholders Association, said that the country needs to be more committed to a stable economic and political climate. This can be done by avoiding speech that divides people, makes personal attacks, and involves character assassination.