• Sunday, October 13, 2024
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Stock market up 0.18% despite Nigeria’s further hike in policy rate

Stocks lose N188bn as October trading begins

Nigeria’s equities market furthered its movement into the green region by 0.18 percent or N104billion on Tuesday, defying the Central Bank of Nigeria (CBN) further hike in monetary policy rate (MPR) in latest push to rein in inflation. This week, the market has risen by 0.33 percent, while this month it has risen by 2.06 percent.

The positive close on the Nigerian Bourse came in line with analysts earlier expectations that investors focus on the banking and consumer goods spaces will continue to catalyse buy-side action in the stock market.

Chapel Hill Denham Nigeria Infrastructure Debt Fund (NIDF) increased most on Tuesday by N10.10 or 9.94 percent, from N101.60 to N111.70, followed by FBN Holdings which increased by N2.80 or 9.93 percent, from N28.20 to N31, while Fidelity Bank made the top advancers list after rising from N14.95 to N16.40, up by N1.45 or 9.70 percent. Shares of Ellah Lakes also increased from N3.38 to N3.71, rising by 33kobo or 9.76 percent.

Read also: Nigeria’s equities transactions hit N3.47trn in eight months

Fidelity Bank, Transcorp, UBA, Caverton and Ellah Lakes stocks were actively traded as investors in 12,081 deals exchanged 763,000,094 shares worth N11.780billion.

Rising from its two-day Monetary Policy Committee (MPC) meeting in Abuja, the Central Bank of Nigeria (CBN) on Tuesday surprises markets by increasing its benchmark interest rate, known as the Monetary Policy Rate (MPR) by 50 basis points to 27.25 percent from 26.75 percent, the fifth straight hike this year.

The Olayemi Cardoso-led CBN also raised the Cash Reserve Ratio (CRR) of commercial banks by 500 basis point to 50 percent from 45 percent, and that of merchant banks by 200 basis points to 16 percent, while keeping other parameters unchanged.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and equities market capitalisation increased further from preceding trading day’s lows of 98,386.6 points and N56.536 trillion to 98,568.59 points and N56.640 trillion. The market’s year-to-date (YtD) return stood higher at +31.82 percent.

Iheanyi Nwachukwu, is a creative content writer with over 18 years journalism experience writing on banking, finance and capital markets. The multiple awards winning journalist is Assistant Editor, BusinessDay. Iheanyi holds BSc Degree in Economics from Imo State University; Master of Science (MSc) Degree in Management from University of Lagos. Iheanyi has attended several work-related trainings including (i) Advanced Writing and Reporting Skills (Pan African University, Lagos); (ii) News Agency Journalism (Indian Institute of Mass Communication {IIMC}, New Delhi, India); and (iii) Capital Markets Development and Regulations (International Law Institute {ILI} of Georgetown University, Washington DC, USA).

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