Emmanuel Ochayi
Nigerian stocks closed May with a surprise gain despite weeks of losses, driven by strong performances across multiple sectors.
The NGX All-Share Index (ASI) ended the month at 99,300.38 points, marking a 1.73% increase, while the Market Capitalisation rose to N56.172 trillion.
Join our WhatsApp ChannelJohn Adebayo, a market analyst, commented, “The consecutive gains this week have significantly boosted investor confidence. Despite the usual trend of May being a selling month, we saw positive movements in key indices.”
Not all sectors fared equally, with the NGX Industrial Goods and NGX Growth indices declining by 0.13% and 0.29% respectively. However, other indices posted gains, with the NGX Banking Index closing at 797.37 points, a 2.97% increase from April.
“Banking stocks have been particularly impressive,” noted Adebayo. “GTCO, for instance, posted the best quarterly profit in banking history and saw a 22.3% gain in May. Fidelity Bank also performed well, gaining 13.33%.”
The NGX Consumer Goods Index recorded a 1.19% gain, driven by stocks like Dangote Sugar and International Breweries, which gained 20.82% and 27.40% respectively. The Oil and Gas Index rose by 2.06%, with Seplat Energy posting a 3.6% gain.
“Investors were drawn to the strong financial performances reported by many banks in their first quarter results,” Adebayo explained. “This was a key factor in the market’s positive movement.”
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Despite a 5.03% decline this quarter, the ASI remains robust with a 32.8% year-to-date gain. The saying “sell in May and go away” did not hold true this year, as May 2024 marks the third consecutive year of gains for the ASI. Data from Nairametrics reveals that the All-Share Index has only posted losses three times in the past decade during May.
The NGX saw a market turnover volume of 9.955 billion shares traded across 197,056 deals, valued at N198 billion in May.
Adebayo emphasised, “This level of activity indicates sustained investor interest and confidence in the market.”
For the week ending May 31, the NGX Banking Index led the charge with an 8.72% weekly gain. The NGX Pension Index also posted significant gains, up by 5.27%.
“Strong performance in the banking sector was a key driver for the week’s gains,” Adebayo said. “We also saw notable increases in the NGX CG Index and the NGX AFR Bank Value Index, which rose by 7.53% and 7.71% respectively.”
During the week, investors traded 2.189 billion shares worth N31.303 billion in 39,362 deals, an increase from the previous week’s 1.986 billion shares valued at N40.715 billion in 38,487 deals.
The Financial Services Industry led the activity chart, trading 1.914 billion shares worth N23.922 billion in 21,717 deals, accounting for 87.41% of the total equity turnover volume and 76.42% of the value. The Oil and Gas Industry followed, with 55.349 million shares worth N3.093 billion in 2,109 deals. The Agriculture Industry took third place, with 45.085 million shares valued at N377.619 million in 1,615 deals.
Notable gainers for the week included Fidelity Bank, FCMB, UBA, and FBNH, which gained 22.89%, 17.65%, 15.63%, and 14.67% respectively. Dangote Sugar Refinery and NASCON, both part of the Dangote Group, gained 20.51% and 20.15% respectively. Other top performers included Consolidated Hallmark Holdings, which gained 14.29%, and Seplat Energy and Oando, which posted gains of 13.67% and 11.85% respectively.
As Adebayo concluded, “The Nigerian stock market has shown resilience and growth, providing a positive outlook for the coming months. Investors should remain cautiously optimistic as we move forward.”
This performance underscores a robust recovery across various sectors, ending May on a positive note and setting the stage for continued growth in the Nigerian stock market.
