Stock market sets new milestone, crosses N20tr capiitalisation

Stock market sets new milestone, crosses N20tr capiitalisation

The market capitalisation of the Nigerian Stock Exchange (NSE) crossed N20 trillion capitalisation for the first time in the history of equity market last week, indicating an inflow of more funds into the market.

The bullish sentiment continued unabated for eight successive sessions last week, causing the All-Share Index (ASI) and market capitalisation to appreciate by 5.42 per cent to close the week at 38,800.01 and N20.279 trillion respectively.

All other indices finished higher except NSE banking, AFR Bank Value, AFR Div Yield and MERI Growth, which depreciated by 1.03 per cent, 0.95 per cent, 0.31 per cent and 0.80 per cent respectively. The NSE ASeM and NSE Growth Indices closed flat.

Analysts predict sustained rally as buying interests in highly capitalised stocks that control 70 per cent of the market capitalisation heightened. The Chief Research Officer of Investdata Consulting, Ambrose Omordion said: “Investors should, at this point, target solid stocks selling at a discount amid the ongoing cautious trading, portfolio diversification ahead of seasonal trends and expectations.

“The NSE’s index action and indicators are looking up in the same direction on a very high traded volume and positive buying sentiments.

“The current undervalued state of the market offers investors opportunities to position for the short, medium and long-term. We expect this trend to continue buying interests in highly capitalised stocks.

“We must warn at this point, that investors should not underestimate the possibility of profit-taking which is inevitable.”

Analysts at Codros Securities said:

“As the year draws to a close, we expect yield-seeking investors to take positions in stocks with attractive dividend yields, in the face of increasingly negative real returns in the fixed income market.

“However, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings.”

A breakdown of trading activities showed that buying interest in Dangote Cement and 22 other stocks lifted investors’ wealth further by N334 billion on Monday.The ASI gained 638.65 absolute points, representing a gain of 1.74 per cent to close at 37,443.40 points. The overall market capitalisation value also appreciated by N334 billion to close at N19.570 trillion.The uptrend was driven by price appreciation in medium and large capitalised stocks such as Dangote Cement, BOC Gases Nigeria, Flour Mills of Nigeria, Lafarge Africa and PZ Cussons Nigeria.Bulls extended their dominance in the Nigerian equity market to seventh successive sessions on Tuesday, as the ASI appreciated by 1.20 per cent.The […]

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