October 11, (THEWILL) – The Nigerian Exchange’s 9.50 percent gain in the third quarter looked, on the surface, like a broad market rally. Between July and September, however, investors rotated sharply between sectors and stocks, allowing the benchmark to climb even as most equities ended the quarter lower.
The NGX All-Share Index rose 21,792.49 points, from 229,419.18 at the end of June to 251,211.67 at September 30. Equity market capitalisation increased by N15.89 trillion, from N147.22 trillion to N163.10 trillion.
Yet of 130 equities traded during the quarter, 72 declined, 44 gained and 14 were unchanged. Decliners therefore accounted for 55.4 percent of the stocks tracked, compared with 33.8 percent for gainers, leaving 28 more decliners than gainers and an advance-decline ratio of just 0.61 times.
That divergence is the central feature of the quarter. The benchmark did not rise because investors bought everything. Instead, capital moved towards particular stocks and sectors at different points in the three months.
July marked the first major rotation. After the 8.37 percent correction in June, investors returned strongly to equities, with the ASI gaining 6.92 percent to 245,283.68 points. Market capitalisation added N11.11 trillion during the month to reach N158.33 trillion.
Banking led the sector rally, jumping 22.10 percent, while Insurance gained 9.29 percent, Industrial Goods 3.57 percent and Oil and Gas 3.21 percent. Consumer Goods, however, fell 4.11 percent, showing that the recovery was already selective.
FirstHoldCo became the clearest symbol of the July move. Its share price rose 131.13 per cent, from N56.05 at the end of June to N129.55 at the end of July. The sharp increase came as investors increased exposure to banking and other large-cap stocks around the half-year earnings season and other corporate developments.
The market therefore began Q3 with a decisive shift towards financials and heavyweight counters.
August interrupted that momentum. The ASI fell 0.44 per cent to 244,199.39 points, while market capitalisation slipped about N590 billion to N157.74 trillion. But the modest monthly decline concealed considerably greater volatility, with the index falling to 238,682.92 points during the month before recovering towards the close.
The sector performance again showed that the market was not moving as one block. Banking stocks gained 3.82 percent and Consumer Goods rose 3.47 percent, while Oil and Gas edged up 0.25 percent. Insurance fell 9.26 percent and Industrial Goods declined 2.03 percent.
August therefore pointed less to a broad withdrawal from equities than to continued rotation between sectors, as the sharp gains recorded by some counters in July gave way to more selective positioning.
READ ALSO:
September brought the next leg of the rotation. The ASI rose 2.87 percent to 251,211.67 points, while market capitalisation added N5.37 trillion to N163.10 trillion.
This time, Oil and Gas became the dominant sector, surging 18.86 percent. The NGX Commodity Index gained 10.76 percent, Banking rose 3.36 percent, and Industrial Goods increased 1.25 percent, while Insurance slipped 0.18 percent and Consumer Goods fell 0.58 percent.
The stock-level numbers were even more revealing. NGX Group gained 35.68 percent in September, Seplat Energy rose 29.86 percent, and VFD Group advanced 28.89 percent. Eterna gained 22.91 percent.
The moves showed that the September rally was again concentrated in selected counters, particularly energy and capital-market-related plays, rather than being a broad-based advance across the exchange.
Over the full quarter, FirstHoldCo was the biggest gainer, soaring 185.28 percent. Eterna gained 58.56 percent, NGX Group 58.15 percent, Seplat Energy 40.80 percent, and VFD Group 38.76 percent.
At the sector level, Oil and Gas recorded the strongest average stock performance over the quarter at 12.65 percent, followed by Financial Services at 3.44 percent. ICT stocks fell an average of 5.71 percent, Consumer Goods 6.67 percent, Industrial Goods 8.59 percent, and Services 8.11 percent.
The difference between sector performance and market breadth reinforces the concentration of the rally. While Oil and Gas and selected financial stocks attracted strong buying, weakness across several other sectors meant that the majority of listed equities still ended the quarter lower.
Trading activity also showed where investors were most engaged. Financial Services accounted for N1.49 trillion of quarterly turnover, far ahead of Oil and Gas at N520.82 billion, while ICT recorded N261.34 billion. The figures underline the importance of banking and financial stocks to market liquidity, even as Oil and Gas produced the strongest average price performance.
September’s repositioning also coincided with major market catalysts, including Nigeria’s reclassification by FTSE Russell and the Dangote Petroleum Refinery IPO. These developments introduced fresh themes for investors and added to the shift in attention towards specific sectors and stocks as the quarter drew to a close.
The quarter therefore tells a more nuanced story than the 9.50 percent headline gain suggests. July was driven by a powerful return to banks and large caps; August brought a pause and greater sector selectivity; while September saw renewed buying in Oil and Gas, NGX Group and selected financial names.
The defining statistic may consequently be the 72 stocks that fell. The NGX rose, but the gains were concentrated. Q3 was not simply a rising market; it was a market in motion, with investors repeatedly reallocating capital towards the sectors, stocks and themes they believed offered the strongest opportunities.
Ogochukwu Onwaeze is a writer specializing in business and economic journalism. At THEWILL News Media, she translates market trends, financial developments, and policy shifts into clear and engaging stories.
