Nigeria equities won’t stop rallying, push year-to-date gains to 24.4% peak

Nigeria equities market in the past nine trading sessions has sustained rally after rally, which has pushed its year-to-date gains to 24.42 percent, positioning it as one of the best performing bourses on the continent in terms of gains.

The positive sentiments in the market, according to analysts, is driven by a return of foreign investors to the market on the back of the Central Bank of Nigeria’s foreign exchange initiative which has brought back liquidity as well as locals’ interest in expectation of release of good half year results by corporates.

Tuesday’s trading session saw benchmark index appreciating 0.41 percent to close at 33,436.61 points as against 0.12 percent appreciation recorded previously, thus buoying year-to-date gains to 24.4 percent.

Market performance was largely bolstered by the sustained rally in consumer goods stocks – NIGERIAN BREWERIES (+1.1%), NESTLE (+1.8%) and UNILEVER (+5.0%) – as well as DANGCEM (+0.4%).

Consequently, market capitalization rose N46.5 billion to N11.5 trillion. However, activity level was mixed as volume traded inched 0.2 percent higher to 323.4 million units while value traded fell 30.0 percent to N1.8 billion.

Performance across sectors was mixed as three of five indices declined while two advanced.

The Insurance index dipped the most, down 1.7 percent due to depreciation in MANSARD (-4.9%) and CUSTODYINS (-4.8%), while weaker sentiment towards FORTE (-4.2%) and sustained sell pressure on OANDO (-0.3%) weighed on the oil & gas index, which declined 0.6 percent.

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As in the previous trading session, profit taking affected the banking index, which slid 0.3 percent. The affected stocks were ZENITH (-1.9%) and ACCESS (-0.8%).

On the contrary, the consumer and industrial goods indices rose 1.4 percent and 0.4 percent on the back of gains in NIGERIAN BREWERIES (+1.1%) and DANGCEM (+0.4%) respectively.

Investor sentiment as mirrored by the market breadth (advancers/decliners ratio) improved to 1.3x (from 0.8x recorded previously) as 24 stocks advanced against 19 that declined.

At the top of the gainers’ chart were HONYFLOUR (+8.3%), UBN (+5.0%) and JBERGER (+5.0%), while MAYBAKER (-5.0%), MANSARD (-4.9%) and CUSTODYINS (-4.8%) topped the losers’ chart.

For analysts at Afrinvest, the rebound in market breadth, which suggests an upturn in investor sentiment towards equities, may persist in the near-term as market performance remains largely driven by expectations of positive half-year earnings reports.

In the NASD OTC exchange, two counters traded – WAMCO and CSCS – with total volume and value of transactions closing at 107,461 units and N968,009.6 respectively. CSCS accounted for 98.0 percent of total volume traded.