Nigeria’s equities value up by N2trn in one week

Despite negative close (-0.86 percent) seen on the last trading day of the week ended Friday, November 13, the cumulative gain recorded by Nigeria’s listed equities stood at about N2.1 trillion, as many investors keyed into the hunt for counters with higher returns.

The stock market benefitted from transfer of funds by asset managers who persistently took positions in bellwether counters amid low-yield environment in the fixed income (FI) market.

Though, all the sectoral indexes closed the review week in green, industrial, banking and consumer goods stocks majorly contributed to the market’s record gain.

The All Share Index (ASI), the benchmark performance indicator of the Nigerian Stock Exchange (NSE), which had opened the review trading week at 31,016.17 points, increased by 12.97 percent to 35,037.46 points at the end of the trading week.

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Also, the value of listed stocks (market capitalisation) increased from a record low of N16.207 trillion at the beginning of the review week to N18.308 trillion.

The equities market’s year-to-date (ytd) positive return stood at + 30.53 percent at the end of the review trading week.

Greenwich research analysts had said they anticipate that “the upbeat performance should persist, amid cynical bouts of profit-taking activities”.

“With the forecasted dividend yields of a number of stocks in the equities market still above what is being offered in the FI market, we expect the stock market to maintain its upward trajectory in the short term,” said research analysts at Vetiva Securities.

“However, we expect the bullish momentum to gradually wane as higher prices automatically drag yields lower,” the analysts said.

Coronation Research analysts had also said in a note to investors that going forward, they think “investors are likely to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings”.