The Nigerian Exchange experienced a robust week of trading, with the All-Share Index and Market Capitalization registering significant gains. The ASI climbed by 1.42%, reaching 103,586.33 points, while the market capitalization expanded by 2.02% to close at an impressive N63.166 trillion. This translates to a substantial N1.25 trillion increase in market value over the four trading days, fueled by active investor participation. The trading volume swelled to 2.618 billion shares worth N69.742 billion, a notable increase from the previous week’s figures of 1.387 billion shares valued at N52.023 billion. This surge in activity signals renewed investor confidence and a positive outlook for the Nigerian stock market. The shortened trading week, due to the New Year’s Day public holiday, did not dampen market enthusiasm.
Sectoral performance revealed a strong showing by the Financial Services Industry, which dominated trading activities. This sector accounted for a significant 66.88% of the total trading volume and 24.49% of the total value. Specifically, 1.751 billion shares worth N17.079 billion were traded within the Financial Services sector. The Services and ICT Industries also contributed meaningfully to market activity, with the Services sector exchanging 205.807 million shares worth N1.829 billion, and the ICT sector recording a turnover of 189.938 million shares valued at N1.844 billion. This highlights the continued importance of these sectors in driving market growth and investor interest.
Among the most actively traded equities were Royal Exchange Plc, Chams Holding Company Plc, and Universal Insurance Plc. Collectively, these companies accounted for 23.38% of the total turnover volume, with 612.033 million shares exchanged for a total value of N773.439 million. This brisk trading in these specific equities suggests investor focus on these companies and potentially reflects underlying market sentiment towards their respective industries and growth prospects. The overall market breadth improved significantly, with 82 equities appreciating in value, a marked increase from the 64 recorded the previous week. Conversely, only 18 equities declined, down from 20 in the preceding week, while 52 equities remained unchanged. This positive market breadth suggests a broad-based rally and a generally bullish sentiment among investors.
While the overall market trend was positive, some equities experienced price declines. PZ Cussons Nigeria Plc led the decliners, shedding 13.79% of its value, closing at N25.00. Other significant losers included CWG Plc (-10.83%), Union Dicon Salt Plc (-10.00%), Nigerian Exchange Group (-9.17%), and Cadbury Nigeria Plc (-6.52%). These declines, while impacting specific investors, did not overshadow the overall positive market performance. The reasons for these individual stock declines would require further analysis, potentially linked to company-specific news, sector-specific challenges, or broader macroeconomic factors.
Countering the decliners, a number of equities registered substantial gains, demonstrating the dynamism of the market. Prestige Assurance Plc topped the gainers’ chart with a remarkable 46% increase, closing at N1.46. Other strong performers included Neimeth International Pharmaceuticals Plc (+45.26%), Sovereign Trust Insurance Plc (+45.16%), Coronation Insurance Plc (+44.92%), and Universal Insurance Plc (+43.64%). These significant gains likely reflect positive investor sentiment towards these companies, potentially driven by strong earnings reports, positive industry outlooks, or anticipated growth opportunities. Further investigation would be needed to pinpoint the specific drivers for each company’s performance.
While the equity market flourished, the Oil and Gas and Sovereign Bond indices experienced dips, declining by 0.45% and 3.28% respectively. This contrast in performance highlights the diverse dynamics within the Nigerian financial market. The decline in the Oil and Gas index may be attributed to fluctuations in global oil prices or sector-specific challenges, while the fall in the Sovereign Bond index could reflect changing interest rate expectations or investor concerns regarding sovereign risk. Despite these declines, other market indices posted gains, reinforcing the overall positive trajectory of the market.
In a further development, the Federal Government of Nigeria listed its December 2024 Savings Bonds on the Nigerian Exchange. This listing comprises two tranches: a two-year bond offering a coupon rate of 17.483% and a three-year bond with a coupon rate of 18.483%. The bonds, issued on December 11, 2024, will mature on December 11, 2026, and December 11, 2027, respectively, with quarterly coupon payments. The total issuance amount for the two-year bond was N876.87 million, while the three-year bond raised N2.44 billion. This bond issuance provides investors with an opportunity to participate in government debt and earn a fixed income, while also contributing to government financing needs.
The positive start to 2025, with the Nigerian Exchange recording a N155 billion gain and a 0.25% increase in the All-Share Index, further underscores the positive momentum in the market. This strong performance, coupled with the increased trading activity and positive market breadth, signals a promising outlook for the Nigerian equity market. However, it’s crucial to note that market performance can be volatile, and investors should carefully consider their risk tolerance and investment objectives before making any investment decisions. A comprehensive analysis of market trends, company performance, and macroeconomic factors is essential for informed investment strategies.
