Emmanuel Ochayi
Investors in Nigeria’s stock market gained N206 billion during the trading week ending Friday, January 24, 2025, as the market closed with a 1.22% rise. The Nigerian Exchange Limited (NGX) All-Share Index (ASI) increased from 102,353.68 points to 103,598.3 points, while the equities market capitalisation rose from N62.851 trillion to N63.645 trillion.
“This week’s market performance was largely influenced by increased buying activity in banking and industrial stocks. However, we observed significant sell-offs in the consumer goods, insurance, and oil & gas sectors,” said a stockbroker at NGX.
Join our WhatsApp ChannelAnalysts Adjust Strategies Amid Brewing Sector Concerns
Coronation research analysts shared their updated approach to managing portfolios. “This week, we adjusted our portfolio by reallocating our holdings in the brewing sector to other industries. This strategic shift reflects our cautious approach as we closely evaluate performance trends in the brewing sector,” they said.
They emphasised the importance of strategic decisions in the stock market. “Moving forward, we will actively monitor market conditions to identify favourable entry points that align with our investment objectives. Our strategy remains prioritising both risk management and long-term value creation,” they added in their January 24 note on their Model Equity Portfolio.
2025 Outlook: 39% Return Projected
Olatunde Omolegbe, Managing Director/CEO of Arthur Stevens Management Limited, spoke optimistically about the stock market’s future. “We project a 39% return on the All-Share Index in 2025, driven by ongoing bank recapitalisation, fresh equity listings, and anticipated monetary policy easing by the Central Bank of Nigeria,” he stated.
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Omolegbe elaborated on factors likely to shape the market. “We anticipate a shift toward equities as fixed-income yields decline, particularly as the CBN adopts a more accommodative stance. Despite concerns about exchange rate volatility and inflation, conservative sectors such as banking, consumer goods, and industrials are expected to perform well.”
Bullish Trends Expected in 2025
In a recent market review and outlook, Omolegbe highlighted that the stock market is set for a bullish 2025. “Investors are positioning ahead of 2024 FY results and dividend declarations, especially in the banking sector,” he said.
He added, “The recapitalisation process will boost investor confidence, while new listings like the Dangote Refinery will enhance market liquidity. Nigeria’s relative market attractiveness, if supported by stable policies, could lead to increased foreign portfolio inflows.”
Focus on Long-Term Strategies
Omolegbe concluded by addressing inflation and its potential impact on the stock market. “We expect inflation to slow, which might positively impact companies in the industrial and consumer goods sectors, as well as those with large capital bases in the financial sector,” he said.
He also outlined their fixed-income strategy. “In the fixed-income space, we will aggressively position with long-dated instruments with high yield, in the hope that high-interest rates will start to drop in the medium term.”
The Nigerian stock market continues to offer opportunities for investors, with cautious optimism shaping strategies for the year ahead.
