Bulls expected to return from the dead as the economic outlook projects a 5.3% return in equities in 2020   

07 January 2020: According to the latest report by a research agency the nation’s equity market is expected to welcome the Bulls. The report resorts some positivity back into the market stating that the economic outlook of the country’s equity market would likely return at + 5.3%, mainly owing to the local demand for solid foundation, high-dividend paying stocks along with an increase in the system liquidity.


The report was released by United Capital Plc, titled: “A Different Playing Field,’’ maps out its results based on the local as well as international economic events, including the impact of the US-China trade war saga on the global economy and the imminent decisions of the Central Banks


In terms of a local perspective, the continued auction of high yield Open Market Operation (OMO) bills to Foreign Portfolio Investors (FPIs) is most likely to keep foreign interest in local equity market tepid.

But, the fear of further currency devaluation still lingers on in investors minds.


“FPIs are likely to continue their flight to safety by swapping/selling equities for low-risk OMO bills.


“Our outlook for stocks in 2020 is anchored on developments in the domestic and global economy with monetary policy as the biggest factor to watch.


“From all indications, the only justification for an uptick in the equities market is the lower yield environment, supported by increased local currency liquidity.


“However, this will not be enough to trigger a major rally in the absence of the demand from FPIs,” the report said.


Seasoned investors, biting their nails as to what might happen in 2020, should definitely get their hands on this publication.


Speaking on the report, United Capital Group Chief Executive Officer, Peter Ashade, said the underlying theme of the outlook report for this year was changed. He stated that the key pillars of the country’s landscape in 2020 will be the oil price, status of the US-China trade war, domestic fiscal and monetary policy.

Reporting for EasyKobo on Tuesday , 07 January 2020 in Lagos, Nigeria


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