Nigeria’s equity market may have rediscovered its lost aura as the increasingly less attractive fixed income instruments, thanks to its apex bank heavy-handedness, induced alpha-seeking investors to gush to risky assets.
The Central Bank of Nigeria (CBN) had banned individuals and small firms from investing in treasury bills and as such investors poured money into shares instead, which boosted the market capitalisation of the Nigerian Stock Exchange (NSE) by N262 billion, thus jumping to the N13 trillion mark.
Following price appreciation as well as strong investor sentiment in the Industrial and Banking goods stocks’, the equities market closed Tuesday’s proceedings on a positive note with the All Share Index (ASI) rising by 0.54 per cent to settle at 26,456.39 points as the market did not see any transactions on Monday following the public holiday declared by the Federal Government.
However, the bears returned to the trading floor as investors lost about N48 billion as market capitalisation closed at N12.821 trillion while the ASI fell by 0.44 per cent to close at 26,357.61 points with year-to-date (YTD) return worsened to -16 per cent,
The downturn, according to brokers, was attributed to price losses in the shares of Seplat, Dangote Cement, Oando and GT Bank.
Thursday’s session saw gains recorded in the shares of Access Bank, GT Bank and Zenith Bank, hence the market capitalisation rose by N236.3 billion.
Consequently, the benchmark index nudged upwards by 1.91 per cent to close at 26,843.11 points and N13.067 trillion respectively while Year-to-Date (YtD) improved to -14.6 per cent.
Friday’s session saw the ASI recording a mild 0.03 per cent to close at 26,851.8 as investors traded stocks cautiously.
The market capitalisation closed the week at N13.071 trillion compared with N12.809 trillion recorded in the preceding session. This means that investors garnered a total value of N262 billion in four days.
Analysts who spoke to Sunday Sun, lauded the efforts of the CBN while adding that its recent ban has impacted the market positively.
Speaking to Sunday Sun, the Managing Director, RMB Nigeria Stockbrokers Limited, Abiola Adekoya, noted that there has been increased participation from domestic investors in the last four trading sessions.
“It has impacted positively on equities as we saw strong investors sentiment towards stocks and this is down to what the CBN did. There has been increased participation on the part of local investors and this is a good one for the market because we cannot always allow international investors to always drive our market”, she said.
Corroborating her position, the Chief Executive Officer, EFG Hermes Nigeria Limited, Lillian Olubi, said that she had predicted that the equities market would see an increased investment and appetite from investors, following the CBN’s directive barring individuals and local corporates from investing in Open Market Operations auctions.
Olubi said that the CBN directive had a positive impact on the equities market, in which case such corporate organisations like pension managers would need to divert more funds into equities market investments.
At the close of trading on Friday, market breadth was positive as 22 stocks gained while 11 others declined. Champion Breweries led the gainers’ list with 10 per cent to close the week at 0.99 Kobo per share, Guinness followed with 10 per cent to close at N28.60, Unity Bank increased by 9.84 per cent to close at 0.67 kobo, FBN Holdings rose by 9.60 per cent to close at N6.85 while Jaiz Bank advanced with a gain of 9.23 per cent to close at 0.71 kobo.
On the flipside, Learn Africa topped the losers’ chart with 9.40 per cent to close at N1.06 per share. NAHCO was next with 8.85 per cent to close at N2.37, Continsure dropped 5.83 per cent to close at N2.26, GT Bank fell by 3.01 per cent to close at N29 while Fidelity Bank declined by 2.91 per cent to close at N2.
Access Bank was top on the volume chart with the sale of 158.78 million shares valued at N1.68 billion. Zenith Bank traded 71.03 million shares valued at N1.35 billion while UBA transacted 41.87 million shares worth N317.02 million.
Overall, the volume and value of stocks traded stood at 469.98 million units and N5.59 billion respectively, exchanged in 5,594 deals.