Despite the surge in the number of confirmed COVID-19 cases and death toll, Nigeria’s stock market enjoyed significant rallies, recording gains in 4 of 5 trading sessions.
As a result, the market’s broad index advanced by 4.45 per cent week-on-week (w/w) to settle at 24,045.40 points, following economic activities that partly resumed last Monday. Accordingly, the year-to-date (YTD) loss moderated to -10.4 per cent while investors gained N534 billion as market capitalisation rose to N12.531 trillion.
Analysts who spoke to Daily Sun attributed the upward trajectory of the market to cheap assets prices, gradual lockdown easing, and inflows of budget facilities ($3.4 billion) from the International Monetary Fund (IMF). They, however, called on investors to trade cautiously as they forsaw profit taking in the trading sessions. Cordros Capital, an investment firm, believes that risks remain on the horizon due to a combination of the increasing number of COVID-19 cases in Nigeria and weak economic conditions.
“Thus, we continue to advise investors to trade cautiously and seek trading opportunities in only fundamentally justified stocks”, they said. For their part, Analysts at Afrinvest, said, “We believe that the gains in the market were driven by bargain hunting, however, we expect investors to book profits in the coming week”.
Meanwhile, performance across sectors was bullish as five of the six counters of the market gained w/w. The Consumer Goods index (+8.5 per cent) led the gainers, driven by price appreciation in Nigerian Breweries (+25.0 per cent).
The Banking (+4.0 per cent) and Insurance indices (+2.8 per cent) trailed on the back of gains in ETI (+12.4 per cent) and Wapic (+26.9 per cent).
Similarly, the Oil & Gas (+2.8 per cent) and Industrial Goods (+2.2 per cent) indices appreciated due to price uptick in Conoil (+9.8 per cent) and Dangote Cement (+15.4 per cent). On the other hand, a price decline in Chams (-4.3 per cent) pushed the AFR-ICT index 0.02 per cent lower.
Furthermore, a total turnover of 1.662 billion shares worth N18.205 billion in 28,791 deals were traded this week by investors on the floor of the exchange, in contrast to a total of 1.012 billion shares valued at N9.892 billion that exchanged hands last week in 17,023 deals.