The Nigerian stock market began the week on a positive note, driven by gains in 33 stocks, which pushed the All-Share Index up by 0.21%. The index rose by 521.70 points to close at 252,635.11 points. This performance was largely driven by price appreciation in large and medium-capitalized stocks. The overall market capitalization value also saw a significant gain, rising by N344 billion to close at N163.999 trillion.
The market's positive performance was attributed to the price appreciation of stocks such as UACN, Eterna, First Holdco, Zichis Agro Allied Industries, and CWG. According to United Capital Plc, the Nigerian equity market is expected to remain strong as investors adjust to the Central Bank of Nigeria's (CBN) new Monetary Policy Rate (MPR) of 23%. The firm noted that lower interest rates could encourage investors to rotate from fixed-income investments into equities.
Investor sentiment remained positive, with 39 gainers outpacing 27 losers. University Press recorded the highest price gain of 9.89% to close at N5.00 per share. Other notable gainers included Critical Minerals Financing Corporation (CMFC), which rose by 9.82% to close at N3.58, and ABC Transports, which gained 9.80% to close at N5.60 per share. Eterna and Sovereign Trust Insurance also saw significant gains.
On the other hand, Fortis Global Insurance led the losers' chart with a decline of 9.50% to close at N1.81 per share. Trans-Nationwide Express and R.T. Briscoe also saw significant losses, declining by 8.47% and 6.07% respectively. Other notable losers included Wapic Insurance and Omatek Ventures.
Trading activity was robust, with the total volume traded advancing by 43.1% to 1.01 billion units, valued at N39.02 billion, and exchanged in 61,517 deals. Fidelity Bank was the most active stock, with 527.428 million shares valued at N10.619 billion. Access Holdings and Zenith Bank also saw significant trading activity.
United Capital Plc noted that the upcoming Dangote Refinery IPO, which is set to close on October 13, is expected to be a major liquidity event. Additionally, Nigeria's reclassification by FTSE Russell as a Frontier Market is expected to attract foreign investor attention. However, the firm cautioned that market gains could moderate if investors decide to lock in profits following the recent rally.
The market's performance is also expected to be influenced by elevated crude prices, which could benefit oil and gas stocks. However, trading will be shortened by Thursday's Independence Day holiday. Overall, the market's positive start to the week is a welcome development, but investors are advised to exercise caution in the face of potential profit-taking.
Key points
- The Nigerian stock market started the week on a positive note, driven by gains in 33 stocks.
- The market's positive performance was driven by price appreciation in large and medium-capitalized stocks.
- Investor sentiment remained positive, with 39 gainers outpacing 27 losers.
