TheCable

Equities on the Nigerian Stock Exchange (NSE), Africa’s largest crude producer, dropped for a ninth day to their lowest level in more than a year on Tuesday, joining a selloff in oil-exporting nations’ shares as the price of the commodity retreated.

The NSE All-Share Index fell 1.6 per cent to 36,744.46, the lowest since September 2013, by the close in Lagos on Tuesday.

Shares in Organization of the Petroleum Exporting Countries (OPEC), including Kuwait and Indonesia, fell as West Texas Intermediate and Brent declined, according to Bloomberg.

“The oil price has a direct impact on the naira, so the slide is affecting interest in Nigerian stocks,” Mike Nwanolue, an analyst at Lagos-based Greenwich Trust Group said.

“It doesn’t seem oil will be anything strong this year as demand to OPEC is not increasing.”

Nigeria, which produced about 2.1 million barrels of oil a day in October, is facing renewed pressure on its currency as falling crude prices erode the West African nation’s foreign-exchange reserves. The naira weakened 0.1 per cent to 165.95 per dollar after earlier falling as much as 0.7 per cent.

Oando Plc, which runs gasoline stations as well as exploring and producing crude, led decliners, falling 4 per cent to N20.75.

Cement stocks fell after Dangote Cement Plc Nigeria’s largest company and the continent’s biggest producer of the building material, announced a price cut of about 40 percent for the commodity.

Dangote Cement dropped 1.7 percent to N208.89 while Lafarge Africa Plc (WAPCO) retreated 5 percent to N99.28. Ashaka Cement Plc declined 5 percent to N28.88.

Foreign investors were among the biggest sellers in Nigeria today, said Ayodeji Ebo, head of research in Lagos at Afrinvest West Africa Limited.

“If they continue to pull out, it will really weigh down the exchange.

It’ll be beyond the capacity of the domestic investors to bring it back.”