Stocks Market Rises By 3.76% As Investors Buy Shares Ahead Of Election


The Nigerian stocks market last week closed positive in four of the five trading sessions as investors continues to take position ahead of the earning season and election. Hence, the overall market performance measure, All-Share Index (ASI), rose by 3.76 per cent to close at 32,715 points. Also, the market capitalisation increased by N442 billion to close at N11.75 trillion. Stocks market analysts noted that investors continued to buy into cheap assets, like Dangote Cement, Nigerian Breweries and Stanbic IBTC, bucking consensus expectation for increased sell offs in trading sessions leading to the general elections. They also, believed sentiments have strengthened due to the increased investor expectation for post-election stability and positive earnings releases. However, the Independent National Electoral Commission (INEC) has postponed the 2019 general elections to February 23, 2019. Across sectors, performance was equally bullish week-on-week (W-o-W). The Consumer Goods and Oil & Gas indices gained, up 5.9 per cent and 5.6 per cent respectively due to price appreciation in Nigerian Breweries, Nestle Nigeria, Seplat Petroleum Development Company and Oando. The Industrial Goods and Banking indices also closed the week positive, up 3.7 per cent and 2.1 per cent on the back of gains in in Dangote Cement, Lafarge Africa, Ecobank Transnational Inc. (ETI), United Bank for Africa (UBA) and Zenith Bank. However, the Insurance index was down by 0.2 per cent due to sell pressures in Custodian Investment and NEM Insurance. Market breadth closed positive with 56 gainers and 13 losers. Weam Bank led the gainers table by 47.14 per cent to close at N1.03 per share. Dangote Flour Mills followed with a gain of 44.09 per cent to close at N9.15, while Livestock Feeds rose by 44 per cent to close at 72 kobo, per share. On the other side, CI Leasing led the decliners table by 18.92 per cent to close at N7.33 per share. MRS followed with a loss of 9.94 per cent to close at N20.85 and Total Nigeria declined by 7.20 per cent to close at N205, per share. Overall, a total turnover of 2.83 billion shares worth N28.14 billion in 28,733 deals were traded last week by investors on the floor of the Nigerian exchange in contrast to a total of 1.89 billion shares valued at N26.88 billion that exchanged hands previous week in 19,210 deals. The effect of the postponement of election on the capital market, a stockbroker and chief executive officer, Sofunix Investment, Sola Oni, said that the sudden postponement few hours to election period was a sad commentary, saying it has deepened Nigeria’s political risk with dire consequences on investment decision. According to Oni, the shock caused by the announcement may jolt foreign portfolio investors who have been apprehensive of the presidential election. “It is not unlikely that trading on the stock may be moderated by this development as it is capable of further eroding investor confidence in our market. Every political decision has direct or indirect impact on the financial market. I think the time has come for our leaders to stop making Nigeria a laughing stock before the international community.”

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