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Stories by Chukwuma Umeorah
Gains in Dangote Cement, Seplat Energy and Oando helped drive a N2.2 trillion rebound in the Nigerian equities market last week, recovering part of the N3.52 trillion lost in the preceding week as renewed buying interest lifted selected stocks.
The market capitalisation of listed equities rose by 1.36 per cent, representing N2.2 trillion, from N161.593 trillion at the close of trading on November 6 to N163.796 trillion on November 13. Similarly, the Nigerian Exchange All-Share Index (ASI) gained 3,391.94 points to close at 252,269.16 points, compared with 248,877.22 points recorded in the previous week.
Dangote Cement, which gained 9.61 per cent to close at N1,469.90 per share from N1,341, was among the major stocks supporting the recovery. Seplat Energy added N241.80 to its share price, rising by 1.51 per cent to N16,241.90, while Oando advanced by 14.80 per cent to N38 from N33.10.
Other major stocks that recorded gains included Transcorp Power, which rose by 5.65 per cent to N232; Honeywell Flour Mills, up 13.73 per cent to N33.55; and Ecobank Transnational Incorporated, which appreciated by 6.93 per cent to N74.85.
The recovery followed a period of profit-taking and price corrections which had weighed on the market in the preceding week.
Explaining the earlier decline, the Chief Executive Officer of Arthur Steven Asset Management, Olatunde Amolegbe, had identified profit-taking as a major factor, noting that market corrections could also create opportunities for fresh investors to enter at lower prices. “Prices go up, people take profits, and it creates an opportunity for other people to go in at a relatively cheaper price,” Amolegbe had said.
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The industrial goods sector provided the strongest sectoral support, with the NGX Industrial Goods Index rising by 6.11 per cent to 12,380.99 points. The Insurance Index followed with a 4.44 per cent gain to 1,072.30 points, while the Commodity Index advanced by 1.22 per cent. The recovery also improved market breadth. A total of 43 equities appreciated in price, compared with 29 in the preceding week, while 39 declined against 57 previously. Another 64 equities closed unchanged, compared with 60 in the previous week.
Among the best-performing stocks, Champion Breweries led the gainers with a 27.27 per cent appreciation to N11.20, followed by Caverton Offshore Support, which rose by 20.55 per cent to N4.40. AXA Mansard Insurance gained 16.10 per cent to N13.70, while Oando advanced by 14.80 per cent to N38.
However, the recovery was not broad enough to lift all sectors. The Consumer Goods Index declined by 0.55 per cent, while the Banking Index shed 0.21 per cent. First HoldCo fell by 2.73 per cent during the week, while Zenith Bank lost 1.28 per cent. Trading activity presented a mixed picture, with the volume of shares exchanged rising sharply while transaction value and the number of deals declined.
Investors traded 8.029 billion shares valued at N185.358 billion in 160,836 deals during the week, compared with 2.829 billion shares worth N208.407 billion in 192,158 deals in the preceding week. This represented an increase of 183.81 per cent in volume, but a decline of 11.06 per cent in transaction value and 16.30 per cent in the number of deals.
The Financial Services Industry accounted for the largest share of trading activity, with 4.854 billion shares valued at N95.790 billion in 72,047 deals. The sector represented 60.45 per cent of total volume and 51.68 per cent of transaction value. The Agriculture Industry followed with 2.243 billion shares worth N22.777 billion, while the Consumer Goods Industry ranked third with 260.996 million shares valued at N11.887 billion.
Linkage Assurance, Livestock Feeds and First HoldCo were the three most actively traded equities by volume, accounting for 5.831 billion shares worth N76.060 billion in 9,544 deals. Their combined activity represented 72.63 per cent of total volume and 41.03 per cent of total value traded during the week. Despite the rebound, the market closed Friday’s session marginally lower, as profit-taking in some heavyweight stocks, including Guaranty Trust Holding Company, Zenith Bank, FCMB and United Capital, weighed on the benchmark index. The ASI declined by 0.04 per cent on Friday to 252,269.16 points from 252,366.80 points on Thursday, while market capitalisation shed N63.41 billion.
The weekly gain lifted the market’s year-to-date return to 62.11 per cent, as gains in industrial goods and selected oil and gas stocks helped offset losses in banking and consumer goods equities.
