Equities market gains N34bn in seven days ahead of presidential elections

THE Nigerian equities market received renewed boost ahead of the presidential election last week as the market closed bullish, recording an increase as investors gained N34 billion by the end of trading activities on Friday.

Foreign and domestic players shunned looming election risk as the Nigeria’s equity market returned to a cheerful mood, analysts at Cordros Capital noted.

Investor optimism over government spending boosting domestic growth continues to support appetite for risk in Nigeria with the All-Share Index steady around 30,748.50 as of writing, Lukman Otunuga, FXTM Research Analyst said during mid-week trading.

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Specifically, the benchmark index of the Nigerian Stock Exchange (NSE) returned a whopping 2.92 per cent Week-on-Week to 31,529.92 points, as the All Share Index (ASI) closed positive in all sessions of the week, leaving the market capitalisation at N11.758 trillion respectively. Thus, the Month-to-Date (MtD) stood at 3.2 per cent, thereby pushing the Year-to-Date (YtD) return into positive territory at 0.3 per cent.

On sectoral breakdown, all sector indices closed positive except for the Industrial (-0.66 per cent) index; with Banking (+8.10 per cent) index leading the pack, followed closely by the Consumer Goods (+4.10 per cent), Insurance (+4.00 per cent), and Oil & Gas (+2.54 per cent) indices respectively.

A total turnover of 1.894 billion shares worth N26.884 billion in 19,213 deals were traded during the week in contrast to a total of 1.452 billion shares valued at N14.788 billion that exchanged hands in 19,318 deals in previous week.

The Financial Services Industry (measured by volume) led the activity chart with 1.498 billion shares valued at N19.724 billion traded in 12,581 deals; thus contributing 79.10 per cent and 73.37 per cent to the total equity turnover volume and value respectively.

The Consumer Goods Industry followed with 144.426 million shares worth N4.552 billion in 2,484 deals. The third place was Conglomerates Industry with a turnover of 143.320 million shares worth N220.050 million in 998 deals.

United Bank for Africa Plc, Zenith Bank Plc and FBN Holdings Plc were the toast of investors during the week under review. They accounted for 791.318 million shares worth N10.817 billion in 5,046 deals, contributing 41.79 per cent and 40.23 per cent to the total equity turnover volume and value respectively.

53 equities appreciated in price during the week, higher than16 recorded in the previous week. 21 equities depreciated in price, 50 equities of the previous week, while 94 equities remained unchanged lower than 102 equities recorded in the preceding week.

Lukman believed that a combination of bargain hunting and growth optimism is likely to push domestic stocks higher ahead of the presidential elections next.

“Confidence over the health of the nation has the potential to receive another welcome boost if next week’s GDP figures for Q4 meet or exceed market expectations. While the outcome of the presidential elections remains highly uncertain, it will certainly have a lasting impact on the Nigerian economy,” he said.

Analysts at Cordros Capital, however, cautioned investors to maintain cautious trading. “Looking ahead, we continue to guide investors to trade cautiously amidst brewing political jitters ahead 2019 elections, and the absence of a positive market trigger. However, we believe positive macroeconomic fundamentals will drive recovery post-election.”