• Wednesday, June 19, 2024
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BusinessDay

Nestle spurs stock market’s gain despite MPC decisions

Fixed income market seen taking shine off equities

Nigeria’s equities market closed positive on Tuesday by 0.11percent as more investors despite MPC decisions bought shares of Nestle Nigeria Plc ahead of its annual meeting on Wednesday, May 22.

The market which gained N61billion on Tuesday, its highest since this week, was driven by buy-side activities in favour of Nestle Nigeria Plc, Berger Paints Plc and other penny stocks like Royal Exchange Plc which spurred the rally amid the outcome of a two-day monetary policy committee (MPC) meeting.

After a two-day MPC meeting, the Central Bank of Nigeria (CBN) further ramped up tightening measures to rein in inflation.

The MPC hiked policy rate by 150 basis points (bps) to 26.25percent; retained cash reserve ratio (CRR) for deposit money bank at 45percent; retained asymmetric corridor at +100bps/-300bps; and retained liquidity ratio constant at 30percent.

At the Monetary Policy Committee meeting, members deliberated on the following macroeconomic concerns: persistent inflation; foreign exchange volatility; the strength and resilience of the banking system; and economic output.

Shares of GTCO, Access Holdings, UBA, Transcorp and Jaiz Bank were actively traded on the Bourse. In 7,228 deals, investors exchanged 222,899,152 shares worth N5.148billion.

The stock market’s benchmark performance indicators – the Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation increased from preceding trading day’s lows of 98,176.58 points and N55.536trillion respectively to 98,285.33 points and NN N55.597trillion.

Nestle increased from N820 to N900, adding N80 or 9.76percent. Berger Paints went up from N13.55 to N14.90, adding N1.35 or 9.96percent. Royal Exchange, a penny stock increased from 56kobo to 60kobo, adding 4kobo or 7.14percent.

Also, the market’s positive close on Tuesday pushed higher the return year-to-date (YtD) to 31.44percent.