NGX Rebounds as Investors’ Wealth Rises N4.57trn Despite Dangote IPO

Investors in the Nigerian equities market recorded more than N4.57 trillion in gains last week as the Nigerian Exchange Limited (NGX) recovered strongly, despite the ongoing N2.2 trillion Initial Public Offering (IPO) by Dangote Petroleum Refinery.

The positive performance marked a reversal from the previous week, when investors lost approximately N1.9 trillion as profit-taking triggered declines across a number of major stocks.

Market analysts said renewed demand for selected equities was responsible for the recovery, pushing both the market capitalisation and All-Share Index higher.

The NGX market capitalisation increased from N157.587 trillion at the end of the previous week to N162.157 trillion last week.

The NGX All-Share Index (ASI) also advanced from 243,052.74 points to 249,804.56 points, reflecting the broad improvement in equity prices.

Trading statistics showed that 3.249 billion shares valued at N237.986 billion changed hands in 287,919 deals during the week. This compared with 3.647 billion shares worth N130.151 billion traded in 244,777 deals during the penultimate week.

The Financial Services Industry remained the dominant sector in terms of trading volume, with 2.581 billion shares valued at N97.212 billion exchanged in 138,900 deals. It accounted for 79.43 per cent of total equity turnover volume and 40.85 per cent of turnover value.

The Services Industry ranked second, recording 131.102 million shares worth N2.731 billion in 15,084 deals. The ICT Industry occupied third place with 114.622 million shares valued at N21.541 billion across 29,152 deals.

By individual stocks, Fidelity Bank Plc, Sterling Financial Holdings Company Plc and Mutual Benefits Assurance Plc topped the volume chart. The three equities recorded combined transactions of 1.229 billion shares worth N15.942 billion in 7,796 deals.

Their combined activity represented 37.83 per cent of total equity turnover volume and 6.70 per cent of total turnover value.

Analysts at InvestData Consulting Limited said the latest figures showed that market activity was improving after the weakness experienced earlier in the month.

They stated:

“The improvement in market activity came as the NGX continued to recover from the weakness recorded earlier in the month. Investors are now watching whether the recent rebound can develop into a more sustained upward move or whether profit-taking will emerge around key technical levels.”

Looking ahead, the analysts said the market was maintaining its short-term recovery, although the approach toward the 250,000-point resistance level could lead to increased caution among investors.

“The market enters the trading session with its short-term recovery intact, although investors are likely to remain cautious as the ASI approaches the 250,000-point resistance area.

“Sustained buying across large-capitalised stocks could provide the momentum needed for the index to test higher levels. However, if buying interest becomes concentrated in only a handful of stocks, the broader market could struggle to maintain the pace of the recovery.”

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