Investors on the Nigerian Exchange added N4.6 trillion in value over the past week, with the All Share Index rising 2.78 per cent to close at 249,804.56 points. Market capitalisation moved to N162.157 trillion from N157.587 trillion, taking the index’s year-to-date return to 60.5 per cent.
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What drove the gains
Demand concentrated in a handful of heavyweight stocks. First HoldCo rose 17.7 per cent, Aradel Holdings gained 9.6 per cent, BUA Cement added 6.8 per cent, MTN Nigeria climbed 3.1 per cent and Zenith Bank rose 2.4 per cent. Sectoral indices closed higher across the board, led by banking, which gained 4.4 per cent, followed by insurance at 3.8 per cent and oil and gas at 3.7 per cent.
Market breadth reflected the mood, with 61 gainers against 39 losers. Sovereign Trust Insurance led the gainers table, rising 30.95 per cent, followed by Mutual Benefits Assurance at 22.03 per cent and NGX Group itself at 21.55 per cent.
Read also: Nigerian stock market closes week with strong investor gains
Why it matters beyond the trading floor
Cowry Assets Management attributed the rally to strong investor sentiment and broad based demand, with banking stocks acting as the primary catalyst. Cordros Securities pointed to two events that will shape the coming week, the outcome of the CBN’s 307th Monetary Policy Committee meeting held on 21 and 22 September, and the formal reinclusion of Nigerian equities in the FTSE Index, effective the same day.
A market delivering this kind of return, right as international index inclusion takes effect, is the backdrop against which Nigerian companies will be judged when they next go looking for capital. For SMEs eyeing the capital market as an alternative to expensive bank credit, sustained rallies of this kind build the investor appetite that eventually filters down to smaller listings and bond issuances.
Total turnover for the week stood at 3.249 billion shares worth N237.986 billion across 287,919 deals, a sharp jump in deal volume from the prior week’s 244,777 transactions. Whether this momentum holds through the MPC decision will say a great deal about how durable investor confidence in Nigerian equities has actually become.
