Nigerian stocks Wednesday sustained a two-week long uptrend as all-share index surged 3.4 percent to a 31-month high of 36,740.77 points, nearing the 37,000 points recorded in late 2014. Year-to-date gains settled at 36.7 percent, making the Nigerian bourse one of the best in terms of gains
According to traders, improving sentiments in the market after several mid-sized listed firms announced increases in half-year earnings, influenced Wednesday’s performance, which also recorded the highest daily gain for the month of July.
Large cap stocks, especially in the banking sector, were yet to post results but expectations are high on improved earnings releases.
Analysts said the development of increase earnings by corporates signals a rebound in the Nigerian economy.
“We expect the current bullish run witnessed in the market to be sustained in the near term as investors anticipate positive corporate earnings releases, especially from the Tier- 1 banks,” analysts at Afrinvest noted.
Wednesday’s bullish performance was largely driven by appreciation in DANGCEM (+4.9%), NIGERIAN BREWERIES (+5.0%) and GUARANTY (+5.0%).
In line with this, stock prices recorded a N577.4 billion gain as market capitalization rose to N12.7tn. Similarly, activity level improved as volume and value traded surged 16.2 percent and 88.6 percent to close at 335.3 million units and N4.6 billion respectively.
Sector performance was broadly bullish as well as all indices closed in the green. The banking index recorded the highest gain, up 3.7 percent due to appreciation in GUARANTY (+4.9%) and ZENITH (+6.7%), while the consumer goods index trailed, adding 2.8 percent on the back of gains in NIGERIAN BREWERIES (+5.0%) and PZ (+5.0%).
Industrial goods index closed 2.5 percent higher due to a rally in DANGCEM (+4.9%) while the oil & gas index gained 1.8 percent on the back of a rebound in OANDO (+7.0%) and TOTAL (+4.3%). Buying sentiment towards CONTINSURE (+4.8%) drove the Insurance index 0.4 percent higher.
Investor sentiment remained positive as market breadth (advancers/decliners’ ratio) improved to 1.8x (against 1.5x recorded yesterday) with 31 stocks advancing against 17 decliners.
The day’s best performers were CONOIL (+10.2%), FIDSON (+10.1%) and OANDO (+7.0%) while the worst performers were AIICO (-5.3%), SCOA (-4.8%) and UBN (-4.6%).