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Total Market Cap of China’s Stock Market Jumped by 33% YoY to $12.4T, the Highest Value in Country’s History

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Chinese Yuan - Investors King

The year 2020 was a fantastic year for stock trading in China, with the total market cap of the country’s stock markets reaching an all-time.

According to data presented by TradingPlatforms, the combined market cap of China’s stock market jumped by 33% year-over-year to 79.7 trillion yuan or $12.4trn in 2020, the highest value in the country’s history.

Market Cap Surged by 83% in Two Years

Over the last four decades, China has experienced an incredible growth rate. Along with impressive economic achievements, the country also witnessed the rapid development of its financial system.

Nevertheless, China’s financial reform is still in process in many directions, developing domestic financial markets, promoting bond and equity markets, liberalizing exchange rates and capital accounts, and improving financial regulation.

One crucial aspect of the financial market development strategy in the country was the fostering of innovation. In recent years, China had the problem that upcoming domestic tech companies preferred to list on overseas stock markets. So, Shanghai Stock Exchange and Shenzhen Stock Exchange, as the two major stock exchanges in Mainland China, established boards with more lenient listing requirements, allowing even startups that had not yet turned a profit to gain access to the financial market.

As a result, the market capitalization of the country’s stock market increased significantly. Between 2014 and 2017, the market cap of China’s stock market jumped by 52%, reaching 56.7 trillion yuan or $8.8trn that year, revealed the China Securities Regulatory Commission data.

After a drop to $6.7trn in 2018, the market cap jumped by 37% YoY to $9.2trn in 2019. However, statistics show that last year witnessed the biggest annual growth, with China’s stock market reaching $12.4trn value, an impressive 83% increase in two years.

Trade Revenue Surged by 62% in a Year

Mainland China has two major stock exchanges. The first one is the Shanghai Stock Exchange that consists of the Main Board and the Star Market. The companies listed on the Main Board are mature and established in their industries, while the Star Market targets innovative startups.

The other major stock exchange is the Shenzhen Stock Exchange, separated into three boards, the Main Board, the SME Board and ChiNext Market.

Besides impressive growth of total market capitalization, China’s stock markets also witnessed a surge in trade revenue last year. In 2020, China’s stock market generated a revenue of over 206 trillion yuan or nearly $32trn, a massive 62% increase in a year. Still, this was 12% less than the trade revenue generated in 2015, as the record year in the country’s history.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Bonds

N139bn Oversubscription of FG Bonds Recorded This Month– DMO

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Bonds- Investors King

The Debt Management Office(DMO) in Nigeria has disclosed that bonds issuance of N214.05 billion ended with an oversubscription of N139 billion in January 2022.

It explained that the auction, which closed on January 19, has a settlement date of January 22, 2022.

This was stated in the Federal Government Bond result issued on Wednesday. 

Two tranches of bonds worth N75 billion each were presented by the Debt Management Office.

The first was a reopened 10-year bond at 12.50 percent with a maturity date of January 22, 2026 while the other was a newly-issued 20-year bond at 13.00 percent with a maturity date of January 21, 2042.

“The amount allotted culminated in N81.72 billion and N88.92 billion for the first and second bond offers.

“The bids received for the 10-year bond ranged from 10.80 percent to 13.25 percent, while the 20-year bond ranged from 11 percent to 14.50 percent,” the result said.

The auction also has a maturity period of 4 years and 20 years.

The DMO added that the auction closed with 160 successful bids out of the 254 bids it got. 

It further stated that, “successful bids for the 12.50% FGN JAN 2026 & 13.00% FGN JAN 2042 were allotted at the Marginal Rates of 11.50% and 13.00%, respectively.

“However, the original coupon rates of 12.5000% for the 12.5000% FGN JAN 2026 will be maintained, while the coupon rate for the 13.00% FGN JAN 2042 (New Issue), is set at 13.00%.”

The bonds have no default risk as interest and principal will be paid promptly. Also, the interest gotten from the securities are tax exempt.

The federal government bond is seen as a risk-free debt instrument and the safest of all investments in the domestic debt market as it is fully backed up by the government.

Purchasing FG bonds implies that you are lending to the government for a period of time and returns will be obtained after the stipulated time.

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Nigerian Exchange Limited

Dangote Sugar, Stanbic, Others Closed in Red as an Anonymous Investor Dumps N29 Billion on Dangote Cement

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Stock Bull - Investors King

Stocks of Dangote Sugar, Stanbic Bank, Ardova, FCMB and others led the Nigerian Exchange Limited (NGX) decline on Thursday despite the bourse extending its this year gains to 7.45 percent.

The market value of all listed stocks gained N248 billion from N24.477 trillion it closed on Wednesday to N24.725 trillion on Thursday. The NGX All-Share Index appreciated by 1.01 percent on Wednesday after posting a 1.73 percent gain on Tuesday to close at 45,890.52 index points.

Activity at the exchange rose to a record-high as investors traded  873,492,331 shares valued at N31.542 billion in 4,342 transactions, more than 300 percent of 252,938,074 shares worth N8.9255 billion that exchanged hands in 4,218 deals on Wednesday.

The increase was a result of jumped in Dangote Cement activity level. Investor or group of investors, likely in insider dealings – expected to be announced soon, transacted  102,917,075 shares of Dangote Cement valued at N28.779 billion. The transaction accounted for 91.24 percent of the total N31.542 billion traded on Thursday.

Breaking down the performance of each sector, the banking industry index appreciated by 36 basis points (bps) on the back of an increase in value of Jaiz Bank (+6.35%), Unity Bank (+6.25%), Sterling Bank (+0.64%), UBA (+0.61%), Access Bank (+0.51%) and Zenith Bank (+0.19%).

Similarly, the industrial index appreciated by 272 basis points (bps) on 5.52 percent gain in Dangote Cement, the most capitalised Nigeria’s listed company. WAPCO lost 0.39 percent points.

The consumer goods sector was weighed upon by a 2.74 percent decline in Dangote Sugar, 1.49 percent decline in the value of Honey Flour and 1.25 percent drop in Champion. However, NNFM, Cadbury and Interbrew posted gains.

Despite the jump in the value of global oil prices to over $90 a barrel this week, the Nigerian oil sector shed 9 bps on a 2.60 percent decline recorded by Ardova. See the details of top gainers and losers below.

Top Gainers

Symbols Last Close Current Change %Change
NNFM N 6.55 N 7.20 0.65 9.92 %
LEARNAFRCA N 1.18 N 1.29 0.11 9.32 %
CADBURY N 8.80 N 9.50 0.70 7.95 %
LINKASSURE N 0.53 N 0.57 0.04 7.55 %
JAIZBANK N 0.63 N 0.67 0.04 6.35 %

Top Losers

Symbols Last Close Current Change %Change
DANGSUGAR N 18.25 N 17.75 -0.50 -2.74 %
STANBIC N 37.00 N 36.00 -1.00 -2.70 %
ARDOVA N 13.45 N 13.10 -0.35 -2.60 %
FCMB N 3.00 N 2.95 -0.05 -1.67 %
HONYFLOUR N 3.35 N 3.30 -0.05 -1.49 %

Top Trades

Symbols Volume Value
CWG 517576289.00 300194247.62
DANGCEM 102917075.00 28779893991.30
FBNH 54041026.00 647958220.70
TRANSCORP 34103184.00 34704157.60
SOVRENINS 20985290.00 4886794.70

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Nigerian Exchange Limited

Stock Investors Gained N526 Billion in Three Days

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stock - Investors King

Investors in the Nigerian Exchange Limited (NGX) have realised a combined N526 billion gain in the last three trading sessions to offset Monday’s decline. The Exchanged, which closed at N23.951 trillion market value on Friday, increased to N24.477 trillion on Wednesday.

On Monday, NGX dipped by N29 billion to N23.922 trillion but quickly rebounded on Tuesday and sustain its expansion on Wednesday on the back of renewed interest in the bourse.

Activity level rose on Wednesday as investors traded 252,938,074 shares worth N8.9255 billion in 4,218 transactions, against 235,233,902 shares worth N1.918 billion that exchanged hands in 4,151 deals on Tuesday.

Breakdown of performance showed the NGX Banking Index appreciated 50bps on the back of improvement in Union Bank of Nigeria (+4.46%), Access Bank (+0.52%) and Zenith Bank (+0.39%). Jaiz Bank (-4.55%), Unity Bank (-2.04%), Wema Bank  (-1.15%) and ETI (-0.56%) lost points.

The NGX Consumer Goods Index shed 2bps on Champion (-1.23%) and Honey Flour (-0.59%).  While the NGX Oil and Gas Index gained 221bps on Seplat (+4.36%) and the NGX Industrial index closed flat.

NGX All-share Index appreciated by 1.73 percent to 45,430.14 index points, up from 44,655.89 index points it closed on Tuesday. While market value rose by N418 billion from N24.059 trillion it settled on Tuesday to N24.477 trillion on Wednesday.

A total of 16 large stocks posted gains, against 17 stocks that closed in the red. The year-to-date return rose to 6.35 percent. See the details of top gainers and losers below.

Top Gainers

Symbols Last Close Current Change %Change
AIRTELAFRI N 1050.50 N 1155.50 105.00 10.00 %
CORNERST N 0.50 N 0.53 0.03 6.00 %
COURTVILLE N 0.38 N 0.40 0.02 5.26 %
UBN N 5.60 N 5.85 0.25 4.46 %
SEPLAT N 690.00 N 720.10 30.10 4.36 %

Top Losers 

Symbols Last Close Current Change %Change
FTNCOCOA N 0.39 N 0.36 -0.03 -7.69 %
CHIPLC N 0.69 N 0.64 -0.05 -7.25 %
REGALINS N 0.45 N 0.42 -0.03 -6.67 %
JAPAULGOLD N 0.42 N 0.40 -0.02 -4.76 %
JAIZBANK N 0.66 N 0.63 -0.03 -4.55 %

Top Trades

Symbols Volume Value
GTCO 25456346.00 649356251.40
DANGCEM 24453030.00 6481353849.00
FBNH 23094320.00 277150098.30
FIDELITYBK 21137645.00 57157543.48
FCMB 12932757.00 38790482.47

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