Stock market rebounds, investors gain N4.57trn despite Dangote IPO
By Peter Egwuatu
The stock market recorded a strong rebound last week as investors gained over N4.57 trillion on the Nigerian Exchange Limited, NGX, despite the ongoing N2.2 trillion Initial Public Offering, IPO, of Dangote Petroleum Refinery.
The market had, the previous week, lost N1.9 trillion following widespread profit-taking across major stocks.
Analysts noted that the renewed buying interest across selected stocks pushed the benchmark indicators higher.
Specifically, the NGX market capitalization, which represents the total value of equities listed on the Exchange surged to N162.157 trillion from N157.587 trillion the previous week.
In the same vein, the NGX All Share Index, ASI that measures the price movement of the equities went up to 249,804.56 points from 243,052.74 points
Meanwhile, a total turnover of 3.249 billion shares worth N237.986 billion in 287,919 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 3.647 billion shares valued at N130.151 billion that exchanged hands penultimate week in 244,777 deals.
The Financial Services Industry (measured by volume) led the activity chart with 2.581 billion shares valued at N97.212 billion traded in 138,900 deals: thus contributing 79.43% and 40.85% to the total equity turnover volume and value respectively. The Services Industry followed with 131.102 million shares worth N2.731 billion in 15,084 deals. Third place was the ICT Industry, with a turnover of 114.622 million shares worth N21.541 billion in 29,152 deals.
Trading in the top three equities, namely Fidelity Bank Plc, Sterling Financial Holdings Company Plc and Mutual Benefits Assurance Plc (measured by volume), accounted for 1.229 billion shares worth N15.942 billion in 7,796 deals, contributing 37.83% and 6.70% to the total equity turnover volume and value respectively.
Commenting on market performance and outlook, analysts at InvestData Consulting Limited, stated: “The improvement in market activity came as the NGX continued to recover from the weakness recorded earlier in the month. Investors are now watching whether the recent rebound can develop into a more sustained upward move or whether profit-taking will emerge around key technical levels.”
On outlook, they said: “The market enters the trading session with its short-term recovery intact, although investors are likely to remain cautious as the ASI approaches the 250,000-point resistance area.
Sustained buying across large-capitalised stocks could provide the momentum needed for the index to test higher levels. However, if buying interest becomes concentrated in only a handful of stocks, the broader market could struggle to maintain the pace of the recovery.”
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