The Nigerian stock market experienced an extraordinary surge, reaching a record high not seen since 2008, following the suspension of Central Bank Governor Godwin Emefiele.
This unexpected rise on the trading floor has left investors exhilarated and optimistic about the future of the country’s financial markets.
Bloomberg’s report highlights the main index of the Nigerian Exchange surpassing the 57,437-point mark, defying the lackluster performance of MSCI’s primary emerging equity benchmark. This impressive surge has propelled Nigerian stocks to a year-to-date gain of 11.8 percent, nearly doubling the returns of the MSCI index, which stood at six percent.
The sudden rally in the stock market can be attributed to investors’ anticipation of a currency devaluation, coupled with their renewed faith in the newly elected President, Bola Tinubu. This surge in market confidence reflects their positive outlook on the policy signals emanating from President Tinubu’s administration.
Tajudeen Ibrahim, head of research at Chapel Hill Denham, shared insights into this remarkable market performance, stating, “An improvement in the economy will enhance the performance of companies operating in the market.” The sentiment expressed by Ibrahim resonates with investors who have placed their bets on President Tinubu’s proposed economic reforms.
President Tinubu’s recent actions, such as the abolition of fuel subsidies and the suspension of Governor Emefiele, have further bolstered investor confidence. These measures are seen as proactive steps towards economic stability and have prompted a significant surge in the NGX Banking Index, registering its most substantial growth in over eight years with an impressive 8.5 percent rise to reach 570.64.
Ibrahim further emphasized that the expected exchange rate convergence will have a positive impact on liquidity in the foreign currency market, leading to increased trading activities for banks. This suggests that the current momentum in the stock market may continue as trading volumes and liquidity improve.
However, amidst the excitement surrounding the stock market’s surge, concerns are mounting about the depreciation of the Nigerian currency, the naira. With the currency already at 474 naira per dollar, traders are speculating that further depreciation may be on the horizon.
While the Nigerian stock market enjoys this remarkable milestone, investors remain cautiously optimistic about the future. The success of President Tinubu’s policies and the sustainability of the market’s upward trajectory will determine the long-term economic growth and stability of the country.
As the Nigerian stock market continues to make history, investors eagerly await the next chapter in the nation’s financial journey.
Bearish Sentiment Persists: Investors Lose N112 Billion on NGX
Nigerian Stock Market Dips as Weak Momentum Drains N39 Billion from Investors
Dr. Yemi Cardoso’s Nomination Boosts Confidence as Stock Investors Gained N264 Billion
The bullish momentum in the Nigerian Exchange Limited continued on Tuesday as investors pocketed N264 billion in profit following Monday’s gains of N263 billion.
Both the market capitalization and the All-Share Index, which gauge the movement of share prices for all listed companies surged by 0.71 percent to N37.413 trillion and 68,359.22 points, respectively.
This optimistic trading trend emerges as investors increasingly show confidence in the local market and the broader economy, fueled in part by the news of Dr. Yemi Cardoso’s nomination as the Governor of the Central Bank of Nigeria.
As Tuesday’s session drew to a close, the volume of shares traded experienced a significant uptick of 31.33 percent to 676.74 million. However, the number of deals declined by 8.35 percent to 7,659 while the total trade value decreased by 33.97 percent to N5.89 billion.
Market sentiments also leaned towards the bullish side, with 36 gainers outpacing the 27 losers.
Among the top-performing stocks that caught the attention of investors were:
- Berger Paints Plc, which surged by 9.95 percent to conclude the trading day at N11.60.
- Oando Plc, which recently released its audited results for 2021, saw a 9.92 percent increase, closing at N13.30.
- BUA Foods, which gained 6.32 percent to close at N196.70.
- PZ’s shares appreciated by 1.45 percent per unit, ending at N20.
- GTCO Plc stock increased in value by 0.43 percent, closing at N35.40.
On the flip side, the top losers included:
- SCOA Plc, witnessing a 10 percent depreciation in its shares, closing at N1.24.
- Unilever’s shares recorded an 8.28 percent drop, concluding at N13.30.
- United Bank for Africa Plc, which lost 1.96 percent in share value, closing at N17.50.
- FBN Holdings Plc, suffering a 1.69 percent decline, closing at N17.40.
- Accesscorp’s shares depreciated by 0.29 percent, closing trading at N17.40.
The Nigerian Exchange continues to display its resilience and attractiveness to investors, making it an exciting space to watch for potential opportunities and market trends.
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