The Nigerian Exchange Limited is considering an extension of its trading hours from 9 am to 5 pm, from 9:30 am to 2:30 pm, The PUNCH can exclusively confirm.
The NGX Chief Executive Officer, Jude Chiemeka, engaged with market operators on Tuesday in a Zoom meeting that had over 120 participants, including the Chairman of the Association of Securities Dealing Houses of Nigeria, Sam Onukwue.
This development comes on the heels of the Johannesburg Stock Exchange considering the introduction of 24-hour trading to align with global market trends. Across the globe, stock exchanges are extending their trading hours to cater to retail investors who trade via smartphones.
According to the proposal seen by The PUNCH, the pre-open was pegged at 9 am from its current 9:30, the pre-close moved to 16:50 from 14:20, and the market close was proposed to be shifted from 14:30 to 17:00.
Responding to the concerns, the NGX CEO commented that this was the first engagement with trading licence holders in the market on the subject matter.
He said, “This engagement is the first, and we’ll certainly be coming back to this ecosystem in line with the aspiration of extending our trading hours.”
The NGX boss noted that with the work being done with the IFC, Islamic Finance, and engagements with the Ministry of Marine and Blue Economy on blue bonds and social bonds, a lot more tradable instruments would be available on the market in the future, necessitating the move.
“The idea is to make our market competitive as opposed to saying that things are the way they are and they will continue to be like that. Ultimately, the reforms the government is doing, we believe, will really open up our markets. Where we are now is certainly not where we aspire to be. We’re at $11m a day. We’re looking to cross over to $100m to really become an emerging market.
“So, if you plug into the $1tn economy of the Federal Government and their engagements from this change and high-level capital market involvement with the government, we think that some of those reforms will really open up our markets, and very quickly we’ll see more listings and see more trading. So, it’s only relevant now that we begin to make preparations ahead of those days and not wait until they happen before we move on to this extension of trading hours,” he said.
“Like I said at the outset. It is a market innovation. We are trying to internationalise our markets. We are trying to open up our markets. We are trying to bring innovation to our markets. We think the extension of our trading time is in readiness for all the things that this change is doing that will become evident in the near future.”
In his comments, the Head of Trading and Products, Nigerian Exchange Group, Abimbola Babalola, noted that the NGX would be engaging other market players on the trading hours extension, from custodians to other stakeholders.
The PUNCH also observed that some of the trading licence holders opted for a 3 pm closing time instead of the proposed 5pm.
This development signals the introduction of changes into the market. At the webinar to engage market stakeholders on the transition to the T+2 settlement cycle last Wednesday, the NGX boss had disclosed that the NGX was working on talking about increasing the maximum daily price gain of securities, which is currently at 10 per cent.
He said, “We have moved from a maximum of five per cent trading to 10 per cent, and given the sort of liquidity that we are seeing now, and to improve the commercials and trading duration, that subject is something that the exchange would look into with the approval of the SEC.”
At the meeting, the Executive Commissioner (Operations) at the Securities and Exchange Commission, Bola Ajomale, noted the market operators should brace for a recapitalisation and introduction of risk-based supervision, among other changes enabled by the Investment and Securities Act.
