On Tuesday, Nigerian stocks reached their highest point since June 9, 2008, after the benchmark index increased by 4% due to the arrest of central bank governor Godwin Emefiele over the weekend. This sudden suspension has reignited investors’ optimism about the return of much-needed liquidity in the market. The volume of transactions more than doubled compared to the previous session, and foreign participation in the Equity Market has increased following plummeting to N8.5 billion in April from N104 billion.
Emefiele’s arrest impacted the market because his unorthodox policies had discouraged investment in Nigeria. After the announcement, Nigeria’s dollar bonds hit their peak level on Monday this year, boosting optimism visible across markets. Market breadth was also positive, with 61 gainers recorded versus 14 decliners.
The all-share index rose 2,232.6 basis points to 58,163.6, and market capitalisation increased to N31.7 trillion. Year to date, the index has returned 13.5 per cent.
According to analysts at United Capital, the prevailing positive sentiments will result in further buy-interests ahead of the H1-2023 earning season. At the same time, profit-taking activities will weigh on the bourse’s performance as investors seek to book their gains off profitable counters. For equity-vested fund managers and investors, the analysts recommend bargain-hunting exercises across fundamentally sound stocks with improved or relatively cheap valuations.
UBA and GTCO’s shares were the most active, with both companies’ shares valued at N2.3 billion and N6.2 billion, respectively. Altogether, 1.2 billion shares estimated at N19.2 billion were traded in 10,369 deals.
Top five gainers on the Nigerian market included NASCON, Access Holdings, GTCO, Lasaco and Zenith Bank. John Holt, Ellah Lakes, and The Initiates led the decliners, while Japaul, Access Holdings, and Zenith Bank traded the highest volume of shares.
