April 7, (THEWILL)- Nigeria’s equities market closed the first quarter of the year March 28, 2024 on a resounding note of significant growth as investors counted huge gains.
Data by the Nigerian Exchange (NGX) showed that market capitalisation hit N59.12 trillion against N40.91 trillion when the market opened on January 2, 2024.
This represents a gain of N18.2 trillion which exceeds the figure for the equivalent period in 2023 when the market closed N29.54 trillion and gained N6.63 trillion in Q1 23.
All-Share Index, which is the index for measuring the performance of the Nigerian Exchange, rose by 39.83 percent in Q1 2024
The notable positivity recorded in the equities trading performance during the period reflected the bolstering investor confidence despite the runaway inflation and general downturn in the economy.
The renewed interest in the stocks of thriving corporate bodies was driven by the move towards equities by fortune hunters wishing to take position as transactions roll into the peak of the earning season as listed companies declare dividends.
The trend remained unwavering to the end of January equity trading on the NGX closed in the green territory as the NGX All-Share Index appreciated by 3 percent to cross 100,000 index points hitting 101,571.11 points.
The development was unprecedented in the history of the Exchange being the first time the Exchange achieved the feat.
Before crossing the 100,000 points, NGX had secured its position as the world’s best-performing stock market in the first three weeks of 2024, capping off the trading day on January 19, 2024, at an impressive 94,538.12 points.
With a remarkable year-to-date return of 26.43 per cent, the NGX has outshone its global counterparts.
Taking the second spot is the S&P Merval Index, reflecting the performance of the Argentine Stock Exchange (BYMA), with a year-to-date return of 26.37 per cent.
Analysts say the exceptional performance stands as a milestone in NGX’s history, defying prevailing economic challenges such as elevated inflation, a depreciating exchange rate, and persistent security concerns.
Moreover, the year-to-date (YTD) return of the NGX All-Share Index shows its resilience, standing at an impressive 39.83 percent with investors bouncing in fulfillment as they harvest the buoyant growth in their investments to the tune of N18.2 trillion.
Doyen of the Nigerian Stockbrokers, Sam Ndata, had told THEWILL that developments in the political atmosphere contributed to the boost in the performance of the equities market. According to him, politicians no longer wish to take the risk of investing in properties which could be traced by the anti-graft agencies and confiscated, hence they find the equities market a safe haven.
The NGX Alternative Securities Market (ASeM) Index also exhibited impressive performance, recording a remarkable surge of 135.25 percent to emerge as the best-performing index during the quarter.
Stock market analysts note, “This is despite the backdrop of escalating inflation, prospective interest rate adjustments, and volatile exchange rates, investor confidence has displayed remarkable steadfastness. This unwavering assurance has, in turn, spurred heightened market activity and intensified buying engagements”.
A look at the trading performance showed that NGX Industrial Goods Index recorded a growth of 78.49 percent YtD to close Q1, 2024 at 4,841.20 basis points.
The NGX Banking Index and NGX Insurance Index appreciated by 14.76 per cent and 26.20 per cent YTD, respectively. The NGX Consumer Goods Index also rose by 43.66% YTD to close on March 28, 2024, at 1,610.80 basis points.
These factors propelled key performance indicators and spurred market activities, resulting in the stock market being ranked as the second best-performing in Africa, trailing only behind the Zimbabwean exchange.
The NGX equity markets celebrated a resounding triumph at the end of the first quarter of 2024, propelled by a resurgence in investor confidence in listed companies.
This exceptional performance stands as a milestone in NGX’s, defying prevailing economic challenges such as elevated inflation, a depreciating exchange rate, and persistent security concerns.
The optimism manifested in discernible shifts in purchasing behaviour, culminating in the All-Share Index reaching a noteworthy close at 104,562.06 index points by the end of the quarter.
Moreover, the year-to-date (YTD) return of the NGX All-Share Index shows its resilience, standing at an impressive 39.84 percent.
The Nigerian Stock Exchange Alternative Securities Market Index (NGX-ASeM) is an innovative platform for small and medium-sized enterprises (SMEs) to access the capital market for growth and development. NGX- offers SMEs a flexible, low-cost, and efficient solution to raise capital, providing investors with a new source of investment opportunities in emerging sectors.
The NGX-ASeM index tracks the performance of listed companies in sectors such as technology, healthcare, education, and renewable energy.
It provides up-to-date information on the growth and progress of SMEs in Nigeria and helps investors make informed decisions.
About the Author
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
