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NSE LIVE! CBN new forex policy pushes equities to rally N206bn

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NSE LIVE! Equities regain rally with N157bn gain

The upswing orchestrated by the release of the guidelines for the implementation of the new foreign exchange (forex) of the Central Bank of Nigeria (CBN) continued on Thursday at the Nigerian stock market as bullish trading left investors with a gain of N206 billion.

This brought total gain within the past two trading sessions to N500 billion, with the market having gained N294 billion on Wednesday after the announcement of the new forex guidelines.

Under the new flexible foreign exchange system, the CBN will merge all existing segments of foreign exchange market into a single “window”, which pricing will be determined by market forces with limited intervention from the apex bank. In essence, Naira will flow according to market forces with effect from Monday June 20.

Market analysts have been unanimous that the release of the framework for the flexible forex policy was the main driver for the equities market.

With more than two gainers for every loser, aggregate market value of all quoted equities on the Nigerian Stock Exchange (NSE) rose from N9.579 trillion to close at N9.785 trillion, representing a gain of N206 billion. The All Share Index (ASI), the common value-based index that serves as the broad benchmark for the Nigerian stock market, spiraled to another recent high to close at 28,489.89 points as against its opening index of 27,891.96 points, indicating average gain of 2.14 per cent.

The sustained upswing again brought the stock market near the green line of year-long positive return as average year-to-date return moderated to -0.53 per cent.

Read also: NSE LIVE! Forex rules lift equities to N294b gain

Sectoral analysis showed widespread positive sentiments across the sectors. All tracked sectoral indices again closed higher on Thursday, repeating the same feat of Wednesday. The NSE Banking Index led the rally with above average gain of 3.1 per cent. The NSE Consumer Goods Index rose by 2.8 per cent. The NSE Industrial Goods Index appreciated by 2.2 per cent. The NSE Insurance Index returned 1.6 per cent while the NSE Oil & Gas Index improved by 0.7 per cent.

Nigerian Breweries led the 32-stock gainers’ list with a gain of N8.01 to close at N141.76. Lafarge Africa, which was marked down for dividend payment, followed with a gain of N5.03 to close at N74.01. Dangote Cement rallied N2.86 to close at N175.06. Zenith Bank gathered 82 kobo to close at N16.59. Guaranty Trust Bank added 75 kobo to close at N20.70. Cadbury Nigeria rose by 65 kobo to N18. Cement Company of Northern Nigeria and Ecobank Transnational Incorporated appreciated by 41 kobo each to close at N7.76 and N16.81 respectively. Oando chalked up 39 kobo to close at N7.32 while Champion Breweries rose by 30 kobo to close at N3.34 per share.

The momentum of activities improved further as turnover again rose above average to 618.24 million shares valued at N5.41 billion in 6,757 deals. Banking stocks dominated the top activities chart. United Bank for Africa led with a turnover of 165.49 million shares. Zenith Bank followed with 74.63 million shares while FBN Holdings ranked third with 43.72 million shares.

Analysts at FSDH Securities said the market was still under the influence of the Wednesday’sannouncement of the new forex guidelines.

“We expect the positive performance in the market to persist till the end of the week, however we do not rule out the chance of some profit taking by investors,” Afrinvest Securities, a Lagos-based dealer at the stock market, stated.

Meanwhile, GlaxoSmithKline Consumer Nigeria, which proposes to sell a major part of its businesses, continued its weight shedding, losing N1.51 to close at N14.13. Guinness Nigeria followed on the 15-stock losers’ list with a loss of 40 kobo to close at N102.50. Unilever Nigeria dropped by 32 kobo to close at N32.70. PZ Cussons Nigeria declined by 12 kobo to close at N21.49 while African Prudential Registrars slipped by 11 kobo to close at N3.04 per share.

 

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