In February, Nigeria’s stock market rose by N2.5 billion, driven by gains in the industrial, consumer goods, and insurance sectors. The NGX All-Share Index increased by 3.18%, reaching 107,821.39 points, with a year-to-date return of +4.76%. Despite some volatility and a 0.62% decline in the last week, analysts expect improved sentiment due to favorable economic indicators and the earnings season.
In February, Nigeria’s stock market experienced a significant gain, with the total market value of listed equities increasing by approximately N2.5 billion. This rise, amounting to a 3.18 percent uptick, was largely fueled by investments in industrial, consumer goods, and insurance stocks, despite notable declines in the oil and gas, as well as banking sectors.
The Nigerian Exchange Limited (NGX) All-Share Index (ASI) started February at 104,496.12 points and ended at 107,821.39 points, with the total market capitalization increasing from N64.708 trillion to N67.193 trillion by February 28. Improved purchasing activities were observed during the month, particularly with Zenith Bank Plc’s rights and public offerings.
Despite market volatility, the NGX-ASI maintained a positive trajectory, supported by strong fundamentals in select stocks. The market recorded a year-to-date (YtD) return of +4.76 percent, indicating resilience among investors amidst fluctuating conditions.
In February, the National Bureau of Statistics (NBS) reported a decline in the inflation rate, showing a decrease to 24.48 percent in January from 34.80 percent in December 2024. Additionally, the Monetary Policy Committee (MPC) decided to maintain the Monetary Policy Rate (MPR) at 27.50 percent and kept other monetary parameters unchanged.
Meristem research analysts noted that the MPC’s decision might positively influence market sentiment towards equity investments. With the earnings season approaching, they anticipate increased buying interest that may overshadow selling pressures as investors prepare for full-year releases and dividend declarations.
However, in the last week of February, the equities market faced a slight decline of 0.62 percent, driven by selling activity in the banking, insurance, and oil & gas sectors. The market closed the week lower as buyers did not capitalize on the dips.
In summary, Nigeria’s stock market experienced notable growth in February, despite mixed trading conditions. The increase in stock values was mainly propelled by investments in specific sectors, while overall market stability was reinforced by positive economic indicators such as lower inflation rates and strategic monetary policy. While challenges persisted in the last week of February, optimism remains as the earnings season unfolds and investor sentiment improves.
Original Source: businessday.ng
