Nigerian equities rode on the back of intense bargain-hunting for blue chip stocks to rekindle a month-end rally that promises to leave investors with nearly four percentage returns.
Benchmark indices at the Nigerian Exchange (NGX) yesterday indicated average return of 0.95 per cent, equivalent to net capital gain of N273 billion. The rally nudged the average year to date return for the month to 3.7 per cent.
Most analysts expected the bullish sentiment to continue as early results by quoted companies showed a largely resilient performance.
With nearly two advancers for every decliner, the positive overall market situation was driven by widespread demand, especially within the large-cap stocks. The NGX 30 Index, which tracks the 30 largest stocks at the market recorded average return of 0.76 per cent. The blue chip rally was led by Airtel Africa, Cadbury Nigeria and Guaranty Trust Holding Company (GTCO).
The All Share Index (ASI)- the common value-base index that tracks all share prices at the NGX, rose by 499.95 absolute points or 0.95 per cent to close at 53,157.83 points as against its opening index of 52,657.88 points. Aggregate market value of all quoted equities also rose accordingly from its opening value of N28.681 trillion to close at N28.954 trillion.
There were 28 gainers against 15 losers. In percentage terms, John Holt and Geregu Power recorded the highest price gain of 10 per cent each to close at N1.21 and N176 respectively. Nigerian Aviation Handling Company followed with a gain 9.62 per cent to close at N8.55 per share.
International Energy Insurance went up by 9.52 per cent to close at 69 kobo while May & Baker Nigeria appreciated by 8.26 per cent to close at N4.85 per share.
On the downside, Coronation Insurance led the losers’ chart by 8.89 per cent to close at 41 kobo per share. Tripple Gee & Company followed with a decline of 8.57 per cent to close at 96 kobo. Royal Exchange went down by 7.14 to close at 78 kobo per share.
Honeywell Flour Mills lost 6.44 per cent to close at N2.18 while UACN Property Development Company Plc (UPDC) dipped by 5.94 per cent to close at 95 kobo per share.
The momentum of activities also improved as total turnover increased by 17.68 per cent to 201.359 million shares worth N5.666 billion, in 4,332 deals. Zenith Bank topped the activity chart with 36.763 million shares valued at N924.143 million. GTCO followed with 23.345 million shares worth N578.782 million. Transnational Corporation of Nigeria (Transcorp) traded 17.123 million shares valued at N20.553 million.
United Bank for Africa (UBA) traded 11.451 million shares valued at N93.996 million while Geregu Power transacted 11.123 million shares worth N1.792 billion.
Analysts at United Capital Plc noted that the market has so far defied expectations by maintaining strength despite signs of overstretching.
“Over the medium term, we retain our positive outlook for Nigerian equities, supported by depressed yields in the money market space. However, we express caution that in the coming days, significant profit taking activities could see the market witness a pull back,” United Capital stated.