By Patrick Onoja investadvocate

Dec 11 2010 08.40 GMT

Lagos (INVESTADVOCATE) – The newly extended trading hour of the Nigerian Stock Exchange (NSE) is encouraging the dumping of shares by investors.

 

A Council Member of the NSE (name withheld) confirmed this to investadvocate recently in Lagos Nigeria.

 

“The new trading hour is not relevant as it is encouraging the dumping of shares by investors, people now have more time to operate during the trading hours and do whatever they like, for instance, somebody who traveled out of Lagos may take a flight back and still meet the Market and request that his shares be sold” he said.

 

Also, the Council Member further affirmed that if the time was not extended, there would be limited time or opportunity to dump shares; which is currently driving the bearish trend in the Nation’s Stock exchange.

 

On his part, Emmanual Ikazoboh, Interim Administrator of the NSE had affirmed that the extension of trading hour on the Nigeria’s Exchange was one of the strategic moves by the leadership of the NSE to reposition the Exchange for enhanced competitiveness.

 

Ikazoboh further affirmed that another reason for the extension is that the NSE is playing in a global Market and wish to have a platform whereby investors in other parts of the world can be accommodated.

 

As earlier reported, the Capital Market Committee (CMC) on Monday November 29 2010 approved the proposal by NSE and Securities and Exchange Commission (SEC) for extension of the trading hours on its floors by two hours from 9.30 am to 2.30 pm compared to the current time of 9.30 am to 12.30 pm.

 

With this extension in trading hours at the Nation’s Stock Exchange, Stockbrokers would be trading for a period of five hours compared to the previous three hours being traded.

 

The Nigerian Stock Exchange (NSE) would on Monday December 06 2010 commence this extension of trading hours on its Floor.

 

Henceforth, trading structure on the Floor of the Nigeria’s Exchange is as follows from 9.30 am to 10.15 am, we have Market Pre-opening and from 10.15 am to 2.30 pm is open/continuous trading; making it a total of five trading hours.

 

Meanwhile, a review of last week shows that Equity market opened the week on a negative note due to the continued selling drive by investors.

However, the bearish trend resumed and closed the week on a cautious and low appetite position of the investors as bears took hold of the Nation’s stock Exchange, the YTD market performance closed lower at 17.30 percent (17.30%) as equity market records aggregate loss of  -1.46% for the week.

 

Also, the bearish trading sentiments gained more position as All Share Index (ASI) continued the downtrend by -0.59% as appetite for risk dropped accordingly. The week closed in loss on Friday December 10 2010 by -0.64% with aggregate loss of –1.46% in the week in review.