At the end of trading on Wednesday, the Nigerian Exchange Limited’s market capitalization exceeded N40 trillion due to heightened trading activity in banking equities.
In a similar vein, days after reaching 72,000 points, the exchange’s benchmark index, the All-Share Index, exceeded 73,000 basis points.
With a 1.28 percent increase, the market capitalization and the ASI concluded trading at N40.164tn and 73,397.71, respectively. The equities of GTCO, AccessCorp, Transcorp, FCMB, and United Bank for Africa were the main forces behind the day’s trading.
On Wednesday, the value of trade increased by 84.62% to close at N12.829 billion. In a similar vein, there were more traded units. At the closing of trade, it increased by 34.88 percent to 554.64 million units, and there were 7,910 deals.
Ten months after the market cap reached N30 trillion due to domestic investors’ interest, this milestone was reached. The market crossed the N30tn market on February 27, the first trading day following the presidential election.
Stakeholders in the chat capital market expressed excitement about the market’s potential to achieve even greater things.
The market was speculating on the reforms carried out by the current administration, according to Tunde Amolegbe, Managing Director of Arthur Stevens Asset Management Limited, in response to the historic crossing.
“The stock market is a forward-pricing market, meaning that it tends to adjust for policy consequences before they are felt on the ground,” he stated. As a result, even while the public is directly suffering from a variety of measures, the market is wagering that these same policies will have a good effect on the economy over the medium to long term, which explains the current bullish emotions. It’s also important to acknowledge that, should this turn out not to be the case, the market may correct sharply.
“Secondly, it is imperative to acknowledge that the growing inflation rate and the upcoming banking recapitalization programme have a positive empirical impact on the stock market, despite their apparent negative impact on Main Street.”
Speaking about the milestone, Rotimi Fakayejo, an analyst for the economy and capital markets, predicted that it will rise much more.
It is going to rise even farther, he said. Before the year ends, we still expect the ASI to reach 75,000. The year-end results of listed firms in 2023 are expected to do well, particularly the banks. Throughout the year, some banking stocks have increased in value and reached all-time highs.
The industrial, consumer, and telecommunications sectors, which account for a sizable portion of the market capitalization, have not moved as of yet, but we anticipate higher returns. In the market, Dangote Cement, BUA Cement, Airtel, and Nestle will continue to perform better. After examining each of these, the ASI is unable to close below 75,000 basis points. Regardless of the state of the economy, the market’s performance in 2023 will pale in comparison to that of 2024. The market will boom as soon as international investors start to pour in their money and show faith in the system.
The gainers’ chart was led by Transcorp, Multiverse, Infinity Trust Mortgage Bank, ETranZact and Caverton which gained 10 per cent, 10 per cent, 9.97 per cent, 9.73 per cent and 9.66 per cent respectively.
Tantalizers Plc, Thomas Wyatt, The Initiates Plc, Juli Plc, and Chams Plc are the top five losers, with percentage losses of 10%, 9.86%, 9.32%, 9.23%, and 9.05%, respectively.
