Nigerian equities regained their upswing on Tuesday as improved confidence engendered by the new foreign exchange (forex) policy of the Central Bank of Nigeria (CBN) excited investors.
With nearly four advancers to every decliner, equities gathered net capital gain of N224 billion, an average gain of 2.27 per cent.
The CBN had on Monday started the implementation of its new flexible forex policy under which the value of Naira will be determined by market dynamics. Forex plays critical role in determining the direction at the Nigerian stock market where foreign investors account for around 50 per cent of total turnover.
With the clearing of the backlog of forex demand on Monday and clearer outlook for the Naira, the stock market rallied to its highest point so far this year on Tuesday. The All Share Index (ASI), the main index that tracks prices of shares quoted on the Nigerian Stock Exchange (NSE), rose from its opening index of 28,769.90 points to close at 29,422.71 points, the highest point attained so far this year.
Aggregate market value of all quoted equities rose by N224 billion to close at N10.105 trillion as against its opening value of N9.881 trillion. Sectoral analysis showed all group indices closing higher. The NSE Banking Index, which tracks the dominant banking sector, rose by 3.5 per cent. The NSE Industrial Goods Index appreciated by 3.1 per cent. The NSE Consumer Goods Index rose by 1.6 per cent. The NSE Insurance Index gained 1.4 per cent while the NSE Oil & Gas Index appreciated by 0.4 per cent.
The momentum of activities also improved considerably. Total turnover was above average with 533.31 million shares valued at N6.79 billion in 5,736 deals. Banks were the most active stocks. Guaranty Trust Bank recorded the highest turnover of 104.95 million shares. United Bank for Africa followed with 104.92 million shares while Zenith Bank recorded turnover of 83.74 million shares.
Further pricing trend analysis showed 37 gainers against 10 losers. Nestle Nigeria, NSE’s highest-priced stock, recorded the highest gain of N21.12 to close at N816. Dangote Cement, the most capitalised quoted company, followed with a gain of N5.01 to close at N185. Guinness Nigeria rose by N4.10 to close at N104. Lafarge Africa added N2.90 to close at N77.90. Total Nigeria chalked up N2.30 to close at N179.30 per share. GlaxoSmithKline Consumer Nigeria rose by N1.53 to close at N16.53. Nigerian Breweries gathered N1.07 to close at N142.49. Zenith Bank added 73 kobo to close at N16.69. Guaranty Trust Bank rose by 67 kobo to close at N22.05 while Ecobank Transnational Incorporated rallied 50 kobo to close at N16.65.
On the negative side, Transnationwide Express topped the losers’ list with a loss of 10 kobo to close at N1.43. Caverton Offshore Support Group and Honeywell Flour Mills declined by 6.0 kobo each to close at N1.40 and N1.83 respectively while NEM and Unity Bank dropped by 5.0 kobo each to close at 99 kobo and N1.12 kobo respectively.
“The positive close today was driven by domestic investors riding on the wave of expectation of foreign portfolio investments (FPIs) return to the market, hence we expect this gaining trend to persist in the short term,” Afrinvest Securities, a Lagos-based dealer at the stock market, stated.
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