Chief Executive Officer, Nigerian Stock Exchange (NSE), Mr. Oscar Onyema has disclosed that the Federal Government will embark on a lot of domestic borrowings to finance the budget due to the impact of the COVID-19 pandemic.
According to him, the government will shift away from Eurobonds to domestic borrowings with significant emphasis on fixed income.
He said the shift to domestic borrowings would lead to increased activities in the fixed income market as markets and companies adjust to the effect of the COVID-19 pandemic.
“We expect government and corporate companies to raise capital using different platforms, and capital market is one of it,” Onyema said.
He said the market will not witness any initial public offering in the near-time due to the narrative around COVID-19.
Speaking on the topic: “Impact of COVID on African financial markets”, Onyema said COVID had affected government, businesses and individuals in so many ways.
He noted that the Exchange witnessed a lot of volatility with largest single day loss of five per cent at the wake of the coronavirus pandemic.
He said that a lot of foreign investors exited the market in February when the first case of coronavirus was reported in Nigeria.
Onyema said the Exchange, which emerged as the highest stock market in terms of return having finished with 7.5 per growth in January, slid into negative territory due to COVID-19.
Speaking yesterday at a virtual event to mark the 10th anniversary of Brand Africa 100, he said the market had showed some tremendous recovering across all the asset classes.
The NSE boss said investors were redirecting their investment into the capital market that offers higher returns due to foreign exchange challenges and fall in crude oil price.
Chief Executive Officer, Nairobi Securities Exchange, Mr. Geoffrey Odundo, said the Kenyan stock market had experienced heavy down selling in March due to the pandemic.
He said the Exchange transmitted to full remote trading environment to ensure access to the market from anywhere.
“We gave quoted companies more time to file their results and as well allowed companies to do their annual general meetings electronically,” Odundo said.
He noted that international investors were still active in the market but at lower level.