Emmanuel Ochayi
Equity Market Sees Steady Growth Amid Mixed Stock Performance
The Nigerian equities market continued its upward journey on Wednesday, driven primarily by investor interest in banking, insurance, and oil & gas stocks.
The market still recorded gains despite some profit-taking in the consumer goods and industrial sectors.
Join our WhatsApp ChannelSFS Real Estate Investment Trust (REIT) led the pack, posting a 9.99% increase. “We saw strong interest in real estate and energy stocks,” said Michael Johnson, an equity analyst at Vetiva.
“The upward momentum in these sectors is encouraging, but there is a growing caution around industrial stocks.”
Banking, Insurance, and Oil Stocks Shine in the Equity Market
Stocks in the banking, insurance, and oil & gas sectors attracted the most attention from investors. Honeywell Flourmills, for example, increased by 49 kobo to N5.41, marking a 9.96% rise. Similarly, Meyer saw a price surge from N5.83 to N6.41, gaining 9.95%.
However, it wasn’t all positive. On the losing side, Northern Nigeria Flour Mills (NNFM) saw its price drop by 10%, while Berger Paints followed with a 9.81% decrease. “This decline is largely due to profit-taking,” explained Bola Ade, a trader at the Nigerian Stock Exchange. “Investors are cashing in on earlier gains, especially in industries that have shown strong recent performances.”
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Equity Market Capitalisation Increases Despite Profit-Taking
Despite some dips in key stocks, the Nigerian Exchange Limited (NGX) All-Share Index (ASI) and equity market capitalisation both rose by 0.56%. This brought the ASI to 98,230.92 points, while the market capitalisation grew to N56.446 trillion, up from N56.133 trillion.
“The banking sector is proving resilient,” said equity researcher, Tolu Obafemi. “There’s a lot of anticipation around corporate earnings from the banks, which are expected to be strong.”
Active Trading in Equity Market
In total, the market saw 9,627 deals, with 361.3 million shares changing hands for a total value of N7.57 billion. Stocks such as Japaul Gold, FBN Holdings, UBA, UPDC, and Transcorp were among the most actively traded on Wednesday.
“We expect the banking and oil stocks to continue leading the equity market,” noted Obafemi. “But profit-taking in consumer goods may create short-term volatility.”
Analysts Expect Cautious Equity Market Moves
As the market’s year-to-date (YtD) return climbed to 31.37%, equity analysts at Lagos-based Vetiva predicted a more cautious stance from investors as they await corporate earnings from the banking sector.
“We might see some pullbacks in other sectors while everyone keeps a close watch on the banks,” Johnson said.
Even with fluctuations in consumer goods and industrial stocks, the equity market remains on a steady upward trajectory.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
