With its consistent, delicious stock market gains in bellwether businesses, the Nigerian Exchange (NGX) posted yet another impressive performance. The local stock exchange increased to over N38.6 trillion last week as investors in stocks made N1.67 trillion in gains.
Although some market observers predicted the flourishing exchange would slow down in November due to continuing yield repricing in the fixed income market, the favorable price moves consolidated on October’s success.
However, the first week of November 2023 saw the start of bargain hunting as local investors’ enthusiasm in investing in stocks gained momentum despite minimal assistance from overseas portfolio investors. Positive optimism from the earnings fiesta drove the most recent increase on the Exchange.
The naira devaluation has led to an increase in the number of broken balance sheets, which has caused certain firms to confront macroeconomic difficulties, according to third-quarter results reports.
Many others were able to profitably ride the wave, particularly the banking brands whose profits sharply increased due to benefits from FX revaluation. The benchmark index increased by 4.56% week over week, according to NGX data, and hit a record high of 70,196.77 points.
Many stockbrokers stated in their individual market updates that this was a noteworthy achievement, going beyond the psychological threshold of 70,000, which is seen as a huge accomplishment for the exchange.
With about N1.7 trillion gain in four days of bullish outing out of five trading sessions, pushing the year-to-date return to 36.97%, racing ahead of an annual inflation rate of 26.72%.
The trading activity during the week painted a positive picture, with a 31.20% week-on-week increase in the weekly deal count, reaching 37,959 deals, according to Cowry Asset Limited.
The average traded volume also witnessed a significant surge of 69.52%, totalling 2.45 billion units, while the weekly average value increased by 59.61% week-on-week, amounting to N40.57 billion.
The market movers include AIRTELAFRI, SEPLAT, JAPAULGOLD, FBN Holdings, UBA, and STANBIC. Airtel Africa has a dual listing advantage for foreign investors seeking to rotate out of the local bourse. Other trend leaders include TANTALIZER and GEREGU PLC.
Conversely, ELLAHLAKES led the loser chart followed by RTBRISCOE, BETAGLASS, MEYER, and ABBEYBDS. On sectorial contribution, the Insurance, Banking, Industrial, and Consumer Goods indexes experienced week-on-week increases of 7.96%, 2.67%, 0.73%, and 0.47%, respectively.
However, the Oil & Gas index remained largely unchanged during the week, despite notable upticks in SEPLAT and ETERNA. Overall, the equities market increased by N1.67 trillion to ₦38.56 trillion. The exchange can hit N40 trillion market in 2023, according to analysts’ projections.
In October 2023 investor sentiment, as measured by market breadth, declined to 0.2x from 0.3x recorded in September as 55 stocks gained, 43 lost and 54 were unchanged.
The top performing stocks for the month were THOMASWY (+110.4%), CHAMS (+73.4%), and NNFM (+30.8%). Meanwhile, SOVRENINS (18.4%), CHIPLC (-18.3%), and PRESTIGE (-18.0%) were the top underperforming stocks.
