Nigerian equities reopened yesterday with a strong bullish sentiment as investors jostled to take positions in value stocks.
Benchmark indices at the Nigerian Exchange (NGX) indicated average gain of 0.92 per cent, equivalent to net capital gain of N257 billion. The rally nudged the average year-to-date return to 0.9 per cent.
The All Share Index (ASI)-the value-based common index that tracks all share prices at the Exchange, rose by 470.74 points or 0.92 per cent to close at 51,693.08 points as against its opening index of 51,222.34 points.
Aggregate market value of all quoted companies at the NGX rose from its opening value of N27.899 trillion to close at N28.156 trillion.
The positive market position was driven largely by gains recorded by mid and large-cap stocks such as Airtel Africa, Nigerian Breweries, FBN Holdings and Vitafoam Nigeria.
There were 18 gainers to 16 losers. Thomas Wyatt Nigeria recorded the highest gain of 9.28 per cent to close at N1.06 per share. Associated Bus Company followed with a gain 8.0 per cent to close at 27 kobo. Royal Exchange rose by 5.88 per cent to close at N1.08. Airtel Africa rallied by 5.16 per cent to close at N1,630 while consolidated Hallmark Insurance rose by 5.0 per cent to close at 63 kobo per share.
On the negative side, Union Bank of Nigeria (UBN) led the losers with a drop of 8.63 per cent to close at N6.35 per share. Wema Bank followed with a loss of 8.21 per cent to close at N3.58. AIICO Insurance declined by 6.25 per cent to close at 60 kobo per share. Caverton Offshore Support Group dropped by 4.95 per cent to close at 96 kobo while Stanbic IBTC Holdings dipped by 4.33 per cent to close at N32 per share.
The momentum of activities also improved with total turnover rising by 17.10 per cent to 229.219 million shares valued at N2.91 billion in 3,900 deals. Sterling Bank was the most active stock with a turnover of 85.178 million shares valued at N119.255 million. United Bank for Africa (UBA) followed with 21.623 million shares worth N173.308 million. FBN Holdings (FBNH) recorded 20.091 million shares valued at N222.860 million. Access Holdings recorded 10.325 million shares valued at N95.528 million while Zenith Bank traded 8.292 million shares worth N202.481 million.
Analysts at Afrinvest Securities noted that investor sentiment, as measured by market breadth, improved and this could continue in the next trading session.
“In the next trading session, we expect bargain hunting activities to sustain the positive performance,” Afrinvest stated.
Analysts at United Capital however said they the bears could resume activities across counters, as investors book profits from the previous extended rally.
Analysts noted that Central Bank of Nigeria’s recent Cash Reserve Ratio (CRR) debits in the money market will likely discourage investors from sustaining investment in equities in the short-term as they hope for improvement in money market yields.
“However, we see any downturn as a short-term buying opportunity as we expect investors’ risk-on sentiments will linger through first quarter 2023, favouring the equities market, as the prevailing downward pressure interest rates will persist through the quarter,” United Capital stated.
