The Nigerian equities market experienced a bullish week, as investor confidence and an increase of funds from a softening money market propelled the NGX All-Share Index (ASI) to unprecedented levels. The benchmark index rose 4.26 per cent week-on-week, crossing the psychological 126,000-point threshold for the first time in its history, closing at 126,149.59 index points.
This bullish rally was predominantly driven by heightened interest in banking, insurance, and consumer goods stocks, sectors currently benefiting from strong earnings sentiment ahead of the crucial second-quarter reporting season. Investor appetite was further ignited by a notable decline in yields within the fixed income market.
Following the preceding week’s Treasury bills auction, which saw the one-year stop rate dip to 16.30 per cent, equities emerged as a more attractive alternative, triggering a wave of hot money inflows into the bourse. This shift was visibly reflected in the Money Flow Index (MFI), which moved into greener territory, affirming renewed market participation and liquidity.
Market capitalisation mirrored this ascent, advancing by 4.54 per cent to close the week at N79.80 trillion. This translated into N3.46 trillion in value gains for equity investors. Year-to-date, the NGX has now delivered a 22.56 per cent return, reflecting sustained optimism and upward momentum in the market.
The market breadth remained robust, with 89 stocks advancing against just 16 decliners, resulting in a breadth ratio of 5.56x. However, while the market’s direction was overwhelmingly positive, trading activity showed a marginal dip. Total volume and value traded for the week declined slightly by 1.38 per cent and 0.27 per cent to 5.39 billion units and N107.81 billion, respectively. Despite this, the number of total deals rose by 13.34 per cent to 134,389, indicating persistent investor engagement despite the minor lull in turnover.
On the sectoral front, the bullish sentiment was widely distributed. The NGX Insurance Index led the charge with a 13.83 per cent gain, closely followed by the NGX Banking Index, which rose by 12.49 per cent. Key contributors to these gains included financial heavyweights like ZENITHBANK, UBA, FIRSTHOLDCO, AIICO, UNIVINSURE, and GTCO. Notably, GTCO’s rally received a significant boost from its historic dual listing on the London Stock Exchange, making it the first Nigerian bank to achieve such a feat.
The NGX Industrial and Consumer Goods indices also participated in the rally, notching up 2.94 per cent and 2.18 per cent gains, respectively. The NGX Commodity Index inched up 0.31 per cent, buoyed by buying interest in FTNCOCOA, CILEASING, UNIONDICON, MCNICHOLS, MULTIVERSE, WAPCO, NB, and OKOMUOIL. The NGX Oil & Gas Index stood out as the sole laggard this week, dragged down by profit-taking and sell-offs in OANDO and ETERNA.
Among the week’s top performers, FTNCOCOA and REDSTAREX both soared by 60.60 per cent, closely followed by OMATEK (60.4%), CILEASING (60.3%), and MEYER (60.1%). On the flipside, LEGENDINT led the decliners with a 12.5 per cent fall, trailed by INTENEGINS (6.8%), OANDO (6.1%), PRESTIGE (5.3%), and ETRANZACT (4.9%).
Looking ahead, analysts at Cowry Research project a more cautious and potentially mixed tone for the new week. They noted that as the market approaches overbought territory, investors are likely to begin profit-taking and portfolio rebalancing. This potential shift could be further influenced by the upcoming inflation data from the National Bureau of Statistics (NBS) and the growing anticipation surrounding the Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) meeting, scheduled for July 20–21. The MPC’s decisions on interest rates will be critical in shaping fixed income yields and, consequently, investor allocation preferences.
“The NGX now sits at a technical inflection point—poised either for a healthy pullback or a continuation of the uptrend, depending on market sentiment and economic signals. “With the second-quarter earnings season ramping up and companies beginning to announce board meetings for Q2 results approval, investors will remain focused on corporate performance and policy direction,” Cowry Research stated.
Despite the potential for short-term volatility, the research firm maintains its recommendation for investors to “position in companies with strong fundamentals and earnings potential”.
