Coronavirus Reason For Dip In Nigeria’s Equity Market- Teriba 

The Chief Executive Officer of Economic Associates, Ayo Teriba has linked the downtrend in the Nigerian equity market to the impact of the coronavirus (COVID-19) on global oil price.

During the last trading session on Thursday, the All Share-Index (ASI) fell by 62 bpts to 26,808.2, while Market Capitalisation dipped by N86.6 billion to N13.9 trillion, against 14.26 trillion Market Cap recorded on February 21.

The banking sector led the price decline with Stanbic IBTC losing by -6.2%, GTB -2.2% and First Bank Nigeria Holding losing -5.6%.

Teriba however told THE WHISTLER that the obvious explanation for the loss-making trend in the equity market was the global decline in the demand for crude as a result of the spread of the coronavirus, adding that the country’s stock market had marked the price effect.

The expert explained that the mark-down in stock prices of oil distribution companies quoted in the domestic bourse had resulted in the corresponding, “mark- down in those sectors that were exposed to the negative development in the stock market.”

Teriba said that the banking sector was more exposed to the negative trend, which also have implication on the country’s reserves.

He added also, that there were other reasons for individual stock movements.

Reacting to the impact of the first recorded case in the country’s bourse, he said “we have to watch on the coronavirus, the more areas that are shot down to prevent the spread of the virus- like the flight ban to China and other high-risk areas- the less the demand of oil and it becomes more likely that oil price will weaken.”

He however said that, “Once the corona virus is contained, the market will bounce back,” and would not continue in red.