Stocks up to a 9-month low with mixed incomes, political risk

Shares fell to more than nine-month low, yesterday, at the end of trading on the Nigerian stock exchange, suffered mixed earnings for the second quarter and are concerned about political risk ahead of next year's presidential election.

The stock index fell for the fifth consecutive session, having decreased by 0.4 percent to 36,154 points. Shares this year fell by 5.1%, after last year they rose by 42%.

In the second quarter, profits were mixed, and most lenders noted a decline in credit growth, citing a weak economy, while several consumer goods companies recorded a lower profit.

The recently registered fertilizer company Notore reported an increase in pre-tax losses for the nine months to June. Its shares fell 8.8 percent in the week after listing.

Analysts say that the political events that preceded the elections next year, in which President Muhammad Bukhari seeks re-election, also adversely affected investor sentiment.

"Recent falls were focused on several large stocks. The pressure on Nigerian breweries can be on the background of slightly disappointing earnings of H1'18, but Dangote Cement's performance met expectations, "said Michael Famoroti, chief economist at Vetiva Capital.

Last week, Senate President Bukola Saraki, the third-largest elected representative of Nigeria, moved from the ruling party of Bukhari to the main opposition and is quickly becoming a leading critic of the president.

The main deviations were FBN Holdings, Fidelity Bank, Transcorp, Diamond Bank and FCMB, all more than 4 percent. Nigerian breweries, the local unit of the Dutch brewer Heineken, lost 2.9 percent. (Reuters)

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