By Peter Egwuatu
The retention of Monetary Policy Rate, MPR, at 27.5% by the Central Bank of Nigeria, CBN, and some of the announcement of impressive second quarter 2025, Q2’25, earnings by some companies have significantly buoyed positive sentiment in the stock market.
Specifically, the Nigerian Exchange Limited, NGX extended its bullish run last week following increased and widened demand for stocks across major sectors as impressive corporate earnings are now hitting the market ahead of next week’s deadline for submission of second quarter earnings.
Market operators noted that the numbers released so far have given an insight into what players should expect going into the future, which has fueled renewed investors’ interests and confidence while accumulating low, mid and high cap stocks thereby weighing heavily on the benchmark indicator, NGX All Share Index, ASI, which closed higher at 134,452 93 points, rising 2.2% from131,585.66 points the previous week.
In the same vein, investors reaped over N1.8 trillion from their investment on the NGX, as market capitalisation, which represents value of stocks listed on the Exchange closed at N85.055 trillion from N83.241 trillion the previous week.
Analysis of trading last week showed that strong buying interest in BUA Cement contributed to push the price higher by 9.4% followed by Presco, which gained 22.5%. WAPCO gained 9.7%, Oando 18.9% and Dangote Sugar 14.3% .
The Month to Date, MtD, and Year to Date, YtD, returns stood as 12.1% and 30.6%, respectively.
Activity levels were weaker compared to the previous week, with trading volume and value down by 78.9% Week on Week, W/W and 77.6% W/W, respectively.
Sectoral performance was broadly positive following gains in the Industrial Goods Index, which went up by 4.7%, Insurance Index 3.1%, Consumer Goods Index 2.8% , Banking Index 1.8% and Oil & Gas Index 0.9%.
Commenting on market outlook, analysts at Cordros Capital stated: “In the near term, we expect the full commencement of the half year 2025, H1’25 earnings season to drive market sentiment. With lower stop rates at auctions, we anticipate a gradual rotation into equities as investors reposition for improved risk-adjusted returns amid declining fixed-income yields”.
Also commenting analysts at InvestData Consulting Limited, said: “We expect mixed sentiments to continue on profit taking and reaction to corporate scorecards, as more corporate earnings expected in the midst sector rotation and cautious trading, while investors analyse earnings release so far and buying into value in the midst of portfolio reshuffling, even as few audited accounts are expected to hit the market with dividend announcement”.
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