The Nigerian equities market depreciated by N1.12 trillion between July and August 2024, as investors’ profit-taking persisted in some blue-chip companies listed on the Nigerian Exchange Limited (NGX).

The downward trend in the two months under review is coming on the backdrop of a hike in the Monetary Policy Rate, leading investors to divest into lucrative high yield Treasury Bills (T-Bills).

An investigation revealed that the market capitalisation in July 2024 dropped by N1.09 trillion or -1.92 per cent to close at N55.514 trillion from N56.602 trillion it opened for trading, while in August 2024, it dropped further by N36.04 billion or 0.06 per cent to close at N55.478 trillion from N55.514 trillion.

According to capital market analysts, investors in the local market sustained profit-take based on the sentiment, stressing that Nigeria’s capital market is still one of the best performing Exchanges in Africa and World at large.

However, investors’ returns between January and August 2024 stood at N14.56trillion, while average returns on investment stood at 29.16 per cent Year-till-Date growth.

The stock market had gained N15.68 trillion in the first half of (H1) 2024 as investors continued to invest in blue-chip companies.

Capital market analysts stated that the stock market performance eight months of 2024 is on the backdrop of mixed corporate earnings by listed companies, FG’s reforms in the foreign exchange market, among other factors.

Responding to market performance in eight months of 2024, the Vice President, Highcap Securities Limited, Mr. David Adnori stated that investors are trading based on sentiment.

He stated that the emergence of President Bola Tinubu further energised the stock market since market participants have hope in his ability to rejig the economy and implement economy-friendly policies.

Adnori, however, was optimistic that the stock may maintained its positive momentum in H2 2024, on the backdrop of banking sector recapitalisation and expected H1 2024 corporate earnings by most especially the banks listed on the Exchange.

Amid hike in Monetary Policy Rate to 26.75 per cent, capital market experts stated that its impact has created sentiment trading among investors who see fixed-income market as alternative investment opportunity to hedge against double-digit inflation.

Responding also, an Investment Banker & Stockbroker, Mr. Tajudeen Olayinka stated that the N14.56 trillion market capitalisation gain in eight months of 2024 tells us the presence of huge liquid funds in the hands of institutional investors who currently dominate activities in the stock market.

AVA Capital Group has officially listed its N200bn Infrastructure Fund on the Nigerian Exchange (NGX).

This listing marks a critical milestone in Nigeria’s journey toward revitalizing key sectors and enhancing the country’s economic growth prospects.

Speaking at the closing gong ceremony at the NGX in Lagos on Thursday, Efe Shaire, Managing Director of AVA Global Asset Managers Limited, described the event as a reflection of the company’s unwavering commitment to Nigeria’s infrastructure development.

“The AVA Infrastructure Fund is a testament to our belief in the promise of Nigeria’s infrastructure development and the impact long-term private sector capital can have in driving productivity gains and sustainable economic growth,” Shaire remarked.

The fund, structured as a N200bn programme, is designed to address Nigeria’s significant infrastructure gap, estimated at around $100bn.

It aims to transform key sectors such as transportation, energy, and telecommunications, unlocking considerable economic potential and significantly improving the quality of life for millions of Nigerians.

“We are confident that the N200bn AVA Infrastructure Fund, once fully raised and deployed, will be instrumental in transforming Nigeria’s infrastructure landscape,” Shaire added.

The fund is expected to play a pivotal role in enabling private sector-driven infrastructure development, focusing on projects that drive national connectivity and economic expansion.

Jude Chiemeka, Chief Executive Officer of the Nigeria Exchange Group, praised the initiative, stating, “It is a N200bn fund with 4,075 units at 1 million per unit. Our participants are creating products that can benefit the country.”

Chiemeka said investments in infrastructure are crucial for spurring economic growth, which is vital for enhancing the country’s overall development.

Femi Shobanjo, CEO of NGX Regulation Limited, also explained the importance of the infrastructure fund to Nigeria’s economy.

He encouraged fund managers to focus on investments that have long-term sustainability and a positive impact on the environmental, social, and governance (ESG) sectors.

“The regulation business is fair, and investment protection is key,” Shobanjo stated, underscoring the importance of regulatory oversight to ensure transparency and accountability in managing the fund’s resources.

The listing of the AVA Infrastructure Fund has garnered widespread support from stakeholders, who view it as a major step forward in addressing Nigeria’s infrastructure challenges.

Senior Doyen of the exchange, Sam Ndata, stated the fund’s potential to catalyze economic growth and enhance connectivity across the nation.

“Our vision with the AVA Infrastructure Fund is clear: to catalyze growth by addressing the critical infrastructure needs that will drive economic expansion, enhance connectivity, and improve the quality of life for millions of Nigerians,” Ndata explained.

He was optimistic that the fund’s impact would be felt across the nation as it helps close the infrastructure gap.

The AVA Infrastructure Fund’s listing is not just a milestone for AVA Capital Group but also a beacon of hope for Nigeria’s infrastructure future.

As private sector-led initiatives like this gain momentum, the potential for growth and development becomes increasingly promising.

This fund aims to be a driving force in transforming Nigeria’s infrastructure landscape, providing the much-needed foundation for sustainable economic growth.

The Nigerian equities market recorded its first negative close of the week on Wednesday as investors turned cautious amid growing uncertainty.

The market declined by N176 billion in value as risk-off sentiment swept across the trading floor of the Nigerian Exchange Limited (NGX).

The NGX All-Share Index (ASI) fell by 0.32% to close at 96,203.65 points, down from the previous session’s high of 96,510.13 points.

Similarly, market capitalization dropped to N55.261 trillion from N55.437 trillion while the year-to-date (YtD) return slipped from 28.84% to 28.66%.

Investor sentiment was largely driven by concerns over market volatility, prompting many to reduce their exposure to high-risk stocks.

Heavyweights such as MTN Nigeria, Neimeth Pharmaceuticals, Tantalizer, and Jaiz Bank were particularly affected, with their stock prices witnessing notable declines.

MTN Nigeria led the sell-off, shedding N15.80 or 7.91% from N199.80 to N184. Jaiz Bank followed closely with 15 kobo or 6.25% as its share price dipped from N2.40 to N2.25.

Neimeth Pharmaceuticals also saw a sharp decline, falling from N2.20 to N2, down by 9.09%.

Meanwhile, Tantalizer’s share price dropped by 8.64%, losing 7 kobo to close at 74 kobo.

The day’s trading session saw 446.6 million shares exchanged across 10,148 deals, with a turnover of N4.53 billion.

Despite the overall bearish sentiment, stocks like Universal Insurance, Japaul Gold, and Prestige Assurance were actively traded, providing some liquidity in the market.

Analysts from Vetiva had earlier predicted cautious optimism for the midweek trading session, with mixed sentiment suggesting limited upside potential.

The analysts pointed out that investors were likely to retain a risk-off stance in the coming days as market conditions remained uncertain.

The broader market continues to face headwinds, with macroeconomic challenges and global market volatility contributing to the nervousness among investors.

As a result, many are choosing to reallocate their portfolios, favoring more stable investments over the traditionally high-risk equities market.

Analysts expect the cautious mood to persist as investors weigh the risks and opportunities in the Nigerian market. Until clearer signs of stability emerge, market participants may continue to tread carefully, prioritizing capital preservation over aggressive risk-taking.

As the week progresses, all eyes will be on the NGX to see if it can rebound from Wednesday’s losses or if the bearish trend will continue.