Nigeria’s stock market continued on its upward route throughout the trading days in the week ended Friday September 25, 2020.
The record positives made equity investors in Africa’s largest economy witness investments growth of about N389billion. Investors took advantage of cheap valuations of fundamentally sound stocks.
In the review trading week, the gains were largely driven by increased buy sentiment around consumer good and banking stocks, as well as industrial goods stocks.
The NSE Consumer Goods Index increased by +5.99percent; NSE Banking Index went up by +3.59 percent; NSE Industrial Good Index (+2.44percent); NSE Oil & Gas Index (+1.16percent); and NSE Insurance Index (+1.08percent).
“With the influx of liquidity coming into the equities market on the back of the reduction of the MPR by the MPC during the week, investors reacted positively to the announcement, leading to a number of fundamentally sound stocks closing the week higher” said equity research analysts at Lagos-based Vetiva Securities.
The Nigerian Stock Exchange (NSE) All Share Index (ASI) appreciated by 2.92percent from week-open low of 25,572.57 points to 26,319.34 points at the end of the review week. Also, value of listed stocks increased from N13.365 trillion to N13.754trillion. The year-to-date (ytd) negative return of the market decreased remarkably to -1.95percent.
The analysts expect the positive performance to filter into the new week “as both institutional and retail investors continue to channel their funds into attractive counters.”
However, given the rally witnessed in the review week, the possibility of profit taking cannot be overruled.
