Investors stake more interest in Nigeria’s equities despite J.P Morgan’s threat

Stocks erase early gains, start week bearish
MEANWHILE, the Nigerian equities market gained N277 billion in the last two weeks despite the plan by JP Morgan to remove Nigeria from its Government Bond Index (GBI-EM) by the end of the year.

Meanwhile, the equities market closed yesterday on a negative note, as Nigerian Stock Exchange [NSE] All Share Index [ASI] depreciated by 0.22 per cent to close at 30,265.90basis points, compared with the 0.26 per cent appreciation recorded previously. Its Year-to-Date (YTD) returns currently stands at 12.67 per cent

Last week, domestic equities extended their gains, driven by moderate optimism and the restoration of investor confidence buoyed by an anticipation of a definite economic direction from the government. Thus, the ASI gained 17bps to close the day at 30,410.39, bringing year-to-date return

As a result, the market gained N277 billion, rising from N10.148 trillion to N10.425 trillion in two weeks. The market added N42 billion in the first week when JP Morgan made the announcement and gained N225 billion last week.
Some market operators said despite the initial threat, discerning investors see a lot of value in the Nigerian equities market, adding that the fundamentals of many of the companies remain strong.

Apart from the fact that the equities market boasts of hidden value, investors are taking position ahead of the positive impact the announcement of federal cabinet before the end of this month would have on the market. Also, the assurance given by the Central Bank of Nigeria(CBN) helped to calm the frayed nerves of many investors who decided to return to the market,” a stockbroker said.

The CBN Governor, Godwin Emefiele, assured jittery investors that the central bank was “doing everything possible” to ensure that the country remained on the JP Morgan Index in order to avoid the adverse consequences which the country’s exclusion could cause.

Market breadth also closed negative yesterday as Etransact led 16 gainers against 27 losers topped by Vono at the end of yesterday’s session- an unimproved performance when compared with previous outlook.

Market turnover equally closed negative as volume declined by 60.88 per cent against 57.36 per cent upticks recorded in the previous session. UBA, Access and Zenith Bank were the most active to boost market turnover. Zenith Bank and Guaranty topped market value list.

Volume shockers included Cornerst which led the list of active stocks that recorded impressive volume spike at the end of yesterday’s session