Nigerian Equities Market Grows by N3.3trn to N59.43trn
The equities market capitalisation of the Nigerian Exchange (NGX) grew by N3.3 trillion to N59.43 trillion week on week due to listing of Aradel Holdings PLC.
The local exchange keeps on tract with positive momentum despite macroeconomic headwinds, particularly the release of September’s inflation data, which saw consumer price inflation rise to 32.70%, Cowry Asset Limited told investors in a note.
Stockbrokers said the worsening consumer price index, largely driven by persistent hikes in the food index that makes up over 51% of Nigeria’s inflation basket, did little to dampen market sentiment.
At the end of trading session on Friday, the market index or All-Share Index (ASI) advanced 0.47% to close at 98,070.23 points, buoyed by the landmark listing of Aradel Holdings Plc.
The NGX market capitalisation rose by N3.3 trillion or 5.95% week-on-week to N59.43 trillion, a slew of stockbrokers said in their separate reports, citing data from the domestic bourse.
Despite this impressive rally, market breadth was negative, even as 42 stocks posted losses compared to 34 gainers this week.
Cowry Asset Limited said in a note that this mixed sentiment reflected the underlying macroeconomic pressures, yet the year-to-date return stood at a solid 31.16% – trailing annual inflation rate.
Last week, Aradel Holdings Plc listed 4.34 billion shares at N702.69 per share through a ‘Listing by Introduction’. “This positive momentum, propelled by Aradel’s addition, helped maintain investor confidence, reinforcing the oil and gas sector’s participation in the equity market”, Cowry Asset Limited said.
Trading pattern revealed that equities market momentum weakened, resulting to lower traded volumes fueled by rebalancing activities across small, mid, and large-cap stocks.
As a result, the weekly trade value uptrend by 134.5% week-on-week to N73.89 billion, while the traded volumes this week maintained another week of decline by 51.2% week on week to 1.45 billion shares, all executed in 39,546 deals—a 6.91% decrease from the previous week.
Sectoral performance was largely in the positive region as three out of the five sectors tracked closed northward. The Consumer Goods index with gained 1.42% followed by the Oil & Gas and the Industrial index which recorded gains of 1.08% and 0.04% week on week.
The oil and gas sector benefitted significantly from Aradel’s entry, reinforcing investor confidence in the sector. Cowry Asset Limited said these positive performances were driven by TRANSPOWER, MECURE, DANGSUGAR, OANDO, ETERNA and SCOA respectively.
On the other hand, investors continued their portfolio rebalancing in the week as they dump financial stocks from the mix. Consequently, the Banking and Insurance indices were the laggards for the week as they declined by 0.51% and 1.23% week on week.
These negative performances comes on the back of sell-off in REGALINS, INTENEGINS, ROYALEX, FIDELITYBNK, UBA, and JAIZBANK.
TRANSPOWER (19%), MECURE (19%), DANGSUGAR (13%), SCOA (11%), and GOLDEN BREWERIES (10%) emerged the top spot of attraction for equity investors in the week.
REGALINS (15%), TRIPPLE GEE (15%), CAVERTON (9%), ABCTRANS (9%) and VITAFOAM (9%) were the top losers in that manner for the week.
Cowry Asset Limited said market sentiment is expected to remain positive as investors anticipate more Q3 earnings reports. The market has already reacted favourably to several impressive Q3 releases, providing insight into potential year-end performance. #Nigerian Equities Market Grows by N3.3trn to N59.43trn
