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Nigerian Stock Market Soars to Record High Since 2008 Following Central Bank Governor’s Suspension

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.

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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.

 

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Nigerian Exchange Limited

Stocks Rise Slightly in Nigeria’s Equities Market with Julius Berger and Livestock Feeds in the Spotlight

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Nigeria’s equities gained modestly at the start of the week as investor enthusiasm pushed stock prices slightly higher.

The Nigerian Stock Exchange (NGX) All-Share Index climbed by 0.03% or N16 billion, buoyed by notable gains in shares of key companies including Julius Berger, Livestock Feeds, and Neimeth.

Julius Berger saw the most significant increase, with its share price rising from N87.50 to N92.50, a gain of N5 or 5.71%.

This surge reflects growing investor confidence in the construction sector, despite broader market uncertainties.

Livestock Feeds also performed strongly, with its stock price climbing from N2.20 to N2.38, marking an 8.18% increase.

Neimeth Pharmaceuticals followed suit, with its shares rallying from N1.74 to N1.88, up by 8.05%.

Market analysts attribute the market’s cautious optimism to a combination of factors, including upcoming corporate earnings releases and potential dividend declarations.

Futureview Research noted that while the market showed a positive trajectory, investor sentiment might be tempered by increased regulatory scrutiny on banking stocks and anticipation of the Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) meeting.

“We expect a mixed market close this week,” said Futureview Research in their July 22 note. “Cautious trading in banking stocks is anticipated amid increased regulatory oversight, while investor focus is likely to shift towards the bond Primary Market Auction (PMA). This could dampen overall market sentiment.”

Despite the modest gains, analysts are cautious about the short-term outlook. Meristem analysts highlighted that while some stocks have shown positive movement, the broader market could face challenges.

“We anticipate increased activity in equities this week, driven by buying interest in fundamentally strong stocks. However, uncertainty surrounding the MPC’s decisions and potential impacts from the bond and T-bills auction could influence market dynamics,” they noted.

The NGX All-Share Index rose from the previous day’s 100,539.40 points to 100,568.63 points, while the market capitalization increased from N56.929 trillion to N56.945 trillion.

In a total of 8,760 transactions, investors exchanged 335,704,787 shares valued at N3.717 billion.

Trading activity also highlighted the popularity of stocks such as Ellah Lakes, Universal Insurance, United Capital, Veritas Kapital Assurance, and FCMB Group. These stocks saw active trading as investors navigated the market’s current landscape.

As the week progresses, all eyes will be on the MPC meeting, where key decisions regarding interest rates and monetary policy will be announced.

The outcome is expected to play a significant role in shaping investor sentiment and market direction in the coming weeks.

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Nigerian Exchange Limited

Nigerian Stock Market Surges with N512bn Gain Amid Active Trading

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The Nigerian equity rebounded last week as investors pocketed a N512 billion gain on the back of the surge in trading activity.

This surge reflects an active trading environment and positive investor sentiment despite some sectoral declines.

The market capitalization of the Nigerian Exchange Limited rose by 0.87 percent to N56.929 trillion, while the All-Share Index (ASI) climbed 0.86 percent to close at 100,539.40 points.

The rise was driven by a notable increase in the prices of 37 stocks, outpacing the 34 stocks that experienced a price decline over the same period.

In total, investors traded 2.827 billion shares valued at N42.366 billion across 44,277 deals. This marks a slight increase from the previous week’s turnover of 2.765 billion shares worth N85.230 billion in 40,796 deals, indicating a vibrant trading environment.

The Financial Services Industry led the trading volume, contributing 77.08 percent to the overall stock turnover volume and 72.38 percent to the value.

Within this sector, Jaiz Bank Plc, Cutix Plc, and First City Monument Bank Group emerged as the top three equities by volume, accounting for 1.140 billion shares valued at N4.632 billion.

This strong performance underscores the sector’s pivotal role in the market’s recent gains.

The Industrial Goods Industry followed, with 246.921 million shares worth N2.039 billion traded in 2,068 deals, while the Oil and Gas Industry recorded a turnover of 107.218 million shares worth N1.704 billion across 3,128 transactions.

Despite the overall positive performance, several indices saw declines.

The Banking, Insurance, Consumer Goods, Oil and Gas, and NGX Sovereign Bond indices depreciated by 0.05 percent, 4.86 percent, 0.20 percent, 0.10 percent, and 4.35 percent, respectively.

Looking ahead, analysts suggest that the market may face a mildly negative close next week, influenced by cautious trading, especially in the banking sector, amid increased scrutiny.

Also, the Nigerian Stock Exchange has recently delisted the shares of Niger Insurance Plc, Resort Savings and Loans Plc, and RAK Unity Petroleum Plc effective July 18, 2024.

This action, in accordance with Clause 15 of the General Undertaking of the Exchange’s Rule Book, follows the companies’ failure to meet listing standards and reflects a broader effort to ensure market integrity.

Overall, last week’s performance highlights the Nigerian stock market’s resilience and growing investor confidence, even as it navigates sectoral challenges and regulatory changes.

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Nigerian Exchange Limited

NGX Rebounds with N263bn Gain as Small and Mid-Cap Stocks Surge

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The Nigerian Exchange Limited (NGX) recovered on Thursday amid the surge in strong investor demand for small and mid-cap stocks.

The market capitalisation rose by N263 billion to N56.91 trillion.

The All-Share Index climbed by 0.47%, closing at 100,503.21 points, reflecting a solid buying interest across various sectors.

Despite the market’s overall positive performance, trading activity was subdued with a 64.3% decrease in average daily volume to 392.8 million units.

However, the number of deals increased by 3.4% to 9,013, while the traded value declined by 17.3% to N8.33 billion.

Guaranty Trust Holding Company led the volume trades, with 39.75 million shares worth N1.80 billion across 663 deals.

Meanwhile, Airtel Africa dominated in value, with trades worth N2.25 billion in just 34 transactions.

Sector performance was mixed. Gains were recorded in the oil and gas, consumer goods, and industrial goods sectors, rising by 0.19%, 0.07%, and 0.01%, respectively.

Notable stocks included Airtel Africa, Eterna Plc, Oando, and NASCON Allied Industries.

Conversely, the insurance and banking sectors faced losses, declining by 2.35% and 2.28%.

Top gainers of the day were United Capital, Oando, and Africa Prudential, while Linkage Assurance and Veritas Kapital led the decliners.

This rebound highlights investor confidence in Nigeria’s equities market, with opportunities emerging in small and mid-cap stocks.

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