Investors get better deals in Nigerian equities

Since 2013, local and foreign investors playing at the Nigerian Stock Exchange (NSE) have had better deals for choosing to stake their money in the Nigerian market.

The Nigerian stock market All Share Index, which measures the performance of listed equities on the Nigerian bourse, has since this year outperformed that of other key African Exchanges, signalling higher return-on-investment. This is further evidenced in the 33.02 percent year-to-date (ytd) return delivered last week by the Nigerian stock market.

The likelihood of this trending further northwards remains not in doubt as analysts say they expect to see sustained bargain hunting activities of portfolio investors who are likely to remain bullish on value stocks in addition to improving economic outlook.

Data compiled by Proshare research/analysts available to INVESTOR showed that the Nigerians bourse outperformed other key African stock markets like Botswana, Tunisia, South Africa, Kenya, and Egypt.

Beyond the African markets, the trend watch also showed that except for Nikkei 225 (Japan/Asia-Pacific), the Nigerian bourse has also outperformed Nasdaq (USA/North America); FTSE 100 (UK/Europe); DAX (Germany/Europe); CAC 40 (France/Europe); Toronto Stock Exchange (Canada), and S&B/MIB Index (Italy).

In January, the Nigerian bourse yielded 14.31 percent; 3.84 percent in February; 1.19 percent in March, and a negative of 1.31 percent in April. Botswana yielded 3.60 percent in January; 2.04 percent in February; 5.68 percent in March, and 4.09 percent in April and 15.39 percent, two weeks ago.

Also, Tunisian market returned only 2.41 percent in January; 0.11 percent in February; 1.97 percent in March, and 0.58 percent in April and 13.66 percent, last two weeks. For investors in South African, the market yielded 3.96 percent in January; 3.65 percent in February; 2.63 percent in March; -0.41 percent in April, and 12.43 percent, two weeks ago.

For Kenyan investors, the market yielded a negative of 1.27 percent in January; 0.80 percent in February; -6.23 percent in March; 0.12 percent in April, and -6.10 percent, past two weeks. In Egypt, the trend is not quite different as their market returned 1.97 percent in January; -0.69 percent in February; -0.55 percent in March; -18.61 percent in April, and -15.75 percent, past two weeks.

“The current ytd figure foretells that the stock market stands a better chance to close higher compared with previous year figure, considering the fact that current ytd has less than 7 percent to catch with the returns recorded in 2012. The NSE All-Share Index, which recorded +35.45 percent returns in 2012, the highest after the 2008 bubble – continues with the impressive performance in 2013,” according to analysts at Proshare, who also tracked the performance of key African Exchanges in the past four months.

These analysts added: “The sentiment at the global stock market remains optimistic and continues to thread northwards, just as a similar sentiment is being experienced in the Nigerian capital market.”

Stories by IHEANYI NWACHUKWU