The Nigerian Exchange commenced the week with a revitalized surge, adding N285 billion to its market capitalization on Monday. This positive upswing was fueled by significant gains in key stocks such as Julius Berger Nigeria, Cutix, and several insurance companies. The All-Share Index, a crucial indicator of market performance, rose by 435.61 points, a 0.31 percent increase, closing at 141,439.75. This upward movement propelled the market capitalization to N89.5 trillion, signaling a resurgence of investor confidence despite the volatility experienced in the preceding week. While the market had witnessed value erosion recently, Monday’s performance hinted at a potential shift in sentiment, with investors seemingly regaining some optimism.
A deeper examination of the trading data reveals a complex picture. While the market capitalization and the All-Share Index showed positive growth, trading volume and turnover experienced a decline. A total of 589.73 million shares, valued at N11.22 billion, were traded across 33,304 deals. This represented a 23 percent drop in volume and a more significant 56 percent slump in turnover compared to the previous trading session. However, a notable 29 percent increase in the number of deals suggests a broader participation and renewed interest across various stocks. This divergence in trading volume and the number of deals indicates that while the total value traded decreased, the activity was spread across a wider range of companies.
The market breadth, which measures the ratio of advancing to declining stocks, closed positively with 40 gainers outnumbering 17 losers. This positive breadth underscored the overall bullish sentiment. Julius Berger Nigeria spearheaded the gainers’ chart with a substantial 9.93 percent appreciation, closing at N146.10 per share. Cutix followed closely with a 9.86 percent gain, closing at N3.90, while Regency Alliance Insurance also saw a significant 9.70 percent increase, finishing at N1.47 per share. Other notable gainers included Veritas Kapital Assurance and McNichols, both posting gains exceeding 9 percent. The insurance sector, in particular, saw strong performance, with NEM Insurance also adding 8.83 percent to its share price.
Conversely, University Press led the decliners, experiencing a significant 12.06 percent drop to N5.54 per share. Cadbury Nigeria followed with a 9.61 percent decline, while Abbey Mortgage Bank shed 8.39 percent. Daar Communications, Austin Laz, and Mecure Industries also registered losses ranging from 6.02 percent to 7.44 percent. These declines, although impactful for the specific companies, were overshadowed by the overall positive market breadth, indicating that the upward momentum was more widespread.
Analyzing trading activity reveals that FCMB Group dominated the volume chart, with 105.1 million shares valued at N1.14 billion traded across 1,144 deals. Veritas Kapital Assurance also saw significant trading volume with 59.6 million shares changing hands. While Universal Insurance and Aiico Insurance witnessed considerable volume, GTCO emerged as the most traded stock by value with 25 million units traded, amounting to N2.39 billion. Other significant contributors to the trading value included Aradel Holdings, Zenith Bank, and UBA. These high-value trades, even amidst lower overall turnover, suggest continued institutional and large-investor interest in the Nigerian market.
Sectoral performance presented a mixed bag, with the Insurance Index leading the pack with a 3.81 percent gain. This strong performance was largely attributed to the impressive gains in Regency Alliance Insurance, Veritas Kapital Assurance, and NEM Insurance. The Banking Index also registered a healthy 1.12 percent gain, driven by positive movements in FCMB, UBA, and Zenith Bank. Other indices like the NGX Pension Index and the Main Board Index also showed moderate gains. However, the Consumer Goods Index saw a more modest improvement, and the Top 30 Index, representing the market’s largest companies, recorded a marginal increase of just 0.25 percent. This mixed sectoral performance highlights the underlying dynamics within the Nigerian market, with some sectors demonstrating greater resilience and growth potential than others.
Despite Monday’s rebound, it’s essential to acknowledge the broader market context. The market had experienced a one-week decline of 2.27 percent leading up to Monday’s trading session. However, the market maintained a four-week gain of 4.64 percent and a substantial year-to-date appreciation of 37.42 percent. This year-to-date performance underscores a persistent investor appetite for Nigerian equities, despite macroeconomic challenges and periods of volatility. This long-term positive trajectory suggests a belief in the underlying growth potential of the Nigerian economy and its listed companies. While short-term fluctuations are inevitable, the overall trend points to a market that continues to attract investment and generate returns for investors willing to navigate the inherent risks.
