…AIICO Insurance, AXA Mansard top gainers
Onome Amuge
A bullish movement in Nigeria’s insurance sector, fuelled by landmark legislative reforms, has propelled the Nigerian Exchange (NGX) to a new all-time high, extending a 26-day rally.
Equity investors on Thursday reaped gains of N479 billion, reflecting a period of sustained optimism in the local bourse that has seen the market’s year-to-date return swell 42.4 per cent. The momentum, a testament to growing confidence in the capital market, was concentrated in mid- and large-cap stocks, with the insurance industry leading the charge with an impressive 8.76 per cent sectoral gain.
The bullish sentiment, according to market analysts, is a direct response to favourable factors, chief among them being the recent assent to the Nigerian Insurance Industry Reform Act (NIIRA) 2025 by President Bola Ahmed Tinubu. This new law, which repeals and consolidates outdated legislation, is designed to modernise the sector through stringent capital requirements, digitisation, and enhanced consumer protection.
The development has been hailed as a game changer, with the National Insurance Commission (NAICOM) expressing confidence that the reforms will boost the sector’s contribution to the nation’s GDP and attract much-needed investment. The anticipation of industry consolidation through mergers and acquisitions as smaller firms strive to meet the new capital thresholds has also stirred up speculative buying interest.
Driving the day’s gains were a handful of insurance companies that recorded the maximum allowable price appreciation. AIICO Insurance, Cornerstone Insurance, AXA Mansard, and University Press (UPL) all topped the advancers’ chart with a price appreciation of 10.00 per cent each. AIICO, in particular, saw its share price climb from N2.90 to N3.19, a gain of 29 kobo. Similarly, Cornerstone’s stock rose by 53 kobo to close at N5.83, while AXA Mansard added N1.21 to reach N13.31.
Beyond the insurance sector, the rally’s foundations are also being strengthened by strategic positioning ahead of half-year (H1) interim dividend announcements. Investors are actively accumulating stocks with a strong dividend track record, hoping to qualify for payouts from companies with robust H1 earnings. This strategic play has broadened the market’s appeal, drawing in institutional investors who are increasingly reallocating capital from less attractive fixed-income instruments.
Other notable gainers on the day included GUINNESS (+9.98%), UPDC (+9.94%), PRESTIGE (+9.93%), and NEM (+9.93%), all of which demonstrate the widespread nature of the buying pressure.
Despite the market’s overall positive trajectory, a closer look at the day’s trading reveals a complex picture. While the benchmark All-Share Index (ASI) grew by 755.49 basis points to a new high of 146,569.35, market activities in terms of volume and value declined. Total volume and value of all trades reduced by 26.51 per cent and 16.45 per cent respectively. This indicates that while investor sentiment is overwhelmingly bullish, leading to higher valuations, the actual turnover of shares is moderating. This could be interpreted as a sign that investors are holding on to their positions in anticipation of further gains rather than engaging in active short-term trading.
The market’s sectoral performance on Thursday further reflected this mixed sentiment. While the insurance sector’s strong performance was the headline story, other key sectors also contributed positively.
The consumer goods sector gained 4.08 per cent, and the banking index increased 0.20 per cent. However, this was countered by declines in the industrial (-1.73%) and oil & gas (-0.93%) sectors. The underperformance of the oil & gas sector, in particular, has been a persistent theme throughout the year, with analysts attributing its struggles to late filings of audited results, unimpressive earnings, and a perception that dividend payouts may not be commensurate with high stock prices. This has led to an ongoing price correction and a shift in investor focus away from this segment.
The market breadth remained positive, with 44 stocks advancing against 33 that depreciated. The list of laggards was led by CHAMS (-9.94%), followed by CAVERTON (-9.65%), UACN (-9.44%), and MAYBAKER (-8.97%).
Looking ahead, market sentiment appears poised for continued strength. The NGX’s journey towards a projected market capitalisation of N100 trillion seems well underway. With a robust year-to-date return and a growing pool of billion-dollar companies, the market is attracting renewed attention from both domestic and foreign institutional investors. The successful implementation of the insurance reforms and the positive ripple effects across the economy will be a key determinant of whether this bullish run can be sustained.
Analysts at CardinalStone, for instance, note that attention will likely now shift to the banking sector as the market awaits its H1’25 earnings and interim dividend announcements, indicating that the search for value and yield will continue to drive investor behaviour in the coming weeks.
