The Nigerian Exchange Limited (NGX) rebounded on Thursday following a three-day losing streak as bargain hunting in Guinness Nigeria Plc, Transnational Corporation (Transcorp) and 34 other stocks propelled market capitalisation by N216 billion.
The all-share index climbed by 344.24 points or 0.32 percent to close at 106,780.72 points while the overall market capitalisation appreciated to N66.869 trillion.
The market’s rebound was largely driven by price appreciation in large and medium-capitalised stocks, including Africa Prudential, Dangote Sugar Refinery, and First HoldCo.
Investors took advantage of the recent dip in stock prices to accumulate fundamentally strong equities and reverse the negative sentiment that had weighed on the bourse in previous sessions.
Leading the gainers’ chart, Transcorp and SCOA Nigeria recorded the highest price appreciation of 9.98 per cent each to close at N51.80 kobo.
Similarly, Africa Prudential rose by 9.87 per cent to close at N30.60 kobo, while Tantalizers and Caverton Offshore Support Group gained 9.72 per cent and 9.52 per cent, respectively.
In contrast, SUNU Assurance, MRS Oil Nigeria, and Red Star Express led the decliners with a 10 per cent drop each to close at N4.77, N166.50 kobo, and N5.94 kobo, respectively. Lasaco Assurance and UPDC followed, shedding 7.99 per cent and 6.76 per cent, respectively.
Analysts at Afrinvest Limited attributed the positive performance to improved investor sentiment and the declining appeal of fixed income investments following yield adjustments at the recent Treasury Bills Primary Market Auction (PMA).
“We anticipate a sustained positive performance on the bourse, underpinned by improved investor sentiment as well as declining attraction in the fixed income market,” Afrinvest noted.
However, Vetiva Dealings and Brokerage offered a cautious outlook, suggesting that the recovery was primarily a result of bargain hunting rather than a broad shift in market sentiment.
“After three straight sessions of declines, today’s green close was driven largely by bargain hunting rather than a broad shift in sentiment,” Vetiva stated.
The firm projected a mixed trading session ahead with intermittent profit-taking on recent gainers likely to keep the market choppy.
Market sentiment as measured by market breadth was positive with 35 stocks closing in the green against 15 that closed in the red. This optimism was mirrored in trading activities, although the total volume of shares traded dipped by 5.9 percent to 375.725 million units, valued at N10.185 billion, across 11,447 deals.
Guaranty Trust Holding Company (GTCO) topped the activity chart with 49.946 million shares valued at N2.913 billion.
Access Holdings followed with 43.866 million shares worth N1.033 billion while Zenith Bank traded 36.511 million shares valued at N1.727 billion.
Other actively traded stocks included Fidelity Bank, which recorded 27.105 million shares valued at N468.652 million and United Bank for Africa (UBA) with 19.437 million shares worth N705.132 million.
The resurgence in the equity market comes amid broader concerns about the impact of elevated fixed income yields on investors’ risk appetite. While the modest recovery suggests that investors are selectively accumulating stocks with strong fundamentals, the sustainability of this trend remains uncertain amid mixed economic signals.
