Investors staked about N36.6 billion on Nigerian equities last week as foreign and Nigerian investors scrambled to take positions in Nigerian equities after the successful conduct of the March 28 presidential and national assembly elections.
Market pundits saw the largely violence-free and credible election and the emergence of General Muhammadu Buhari (rtd) as president-elect as signs of Nigeria’s political maturity and possible positive changes in the macro economy.
The positive outlook fuelled massive demand for Nigerian equities, sustaining a consecutive four-day upswing for the stock market.
Major foreign and Nigerian investment firms placed “buy” on several Nigerian stocks, a reference to the reduction in the political risk and the attractiveness of Nigerian equities, most of which had been undervalued by sustained depreciation over the past 15 months. Exotix, a global investment firm, described the successful conduct of the election and the emergence of Buhari as “unprecedented positive”.
“A broadly effective voter card system, largely peaceful voting days, generally orderly announcement of results, concession of defeat and most importantly, the win for the opposition candidate, comprise a remarkable, unprecedented and positive presidential election in Nigeria,” Exotix stated.
The firm noted that some macro level concerns which have driven Nigeria to underperform all major frontier markets have thus been removed. Exotix subsequently raised its recommendation for Nigerian stocks, especially banking and consumer goods companies.
Turnover within the four days surged above average to 2.63 billion shares worth N36.58 billion in 21, 393 deals. The financial sector, driven by banking stocks, remained the dominant sector with a turnover of 2.06 billion shares valued at N21.06 billion traded in 12,133 deals; representing 78.1 per cent and 57.6 per cent of the total turnover volume and value respectively.
The conglomerates sector was the second most active sector with a turnover of 178.25 million shares worth N2.352 billion in 1,493 deals while the consumer goods sector placed third with a turnover of 118.96 million shares worth N5.59 billion in 2,816 deals.
The trio of FBN Holdings Plc, Guaranty Trust Bank Plc and Access Bank Plc were the most active stocks as they jointly accounted for 834.17 million shares worth N12.16 billion in 5,089 deals, representing 31.7 per cent and 33.3 per cent of the total turnover volume and value respectively.