Stock market gain 18.9% H1 in of 2023, rises by N468bn on last trading day

Spread the love

Equity trading on the Nigerian Exchange Limited (NGX) concluded the first half the year on a positive note, with the NGX All-Share Index gaining 18.9% and closing at 60,968.27 index points.

This marks a significant milestone for the index, reaching its highest level in 15 years since March 5, 2008, when it stood at 66,381.20 points.

The month of June saw the All-Share Index rise by 9.32%, breaking a four-year streak of losses for stocks during this month. It also represents the best monthly performance for the stock market in approximately two and a half years.

Despite concerns such as rising inflation, interest rate hikes, and apprehension surrounding the fallout of the 2023 general elections, investor confidence remained strong, leading to increased buying activity.

The positive sentiment among investors can be attributed to several factors, including the peaceful transition to power following the 2023 elections, favorable policies introduced by President Bola Tinubu’s new administration such as the removal of fuel subsidies, streamlining of exchange rates, and the floating of the naira.

Investors responded to the changes in Nigeria’s foreign exchange operational framework and also viewed President Bola Tinubu’s decision to suspend Central Bank Governor Godwin Emefiele, who had implemented restrictive policies affecting their profits, in a favorable light.

Market analysts believed the renewed sentiment in the local bourse market had also grown following a craving to increase capital gains on the back of low prices of stocks owing to upset in the financial market arising from unstable policies and build-up to the 2023 general elections.

Mr. David Adonri, Executive Vice Chairman, of Hicap Securities Limited in a chat said that investors were in the earning season and that what investors will get from dividends is one of the factors that drove the demand for shares in the market during the half year.

He noted that the equities market is defying current political uncertainties because investors are futuristic that the prospect for a yield environment is bright.

“Most companies, especially banks, released their 2022 full-year results during the first quarter. The market normally sustains positive sentiment during the earning season. However, the season was within the period of an election, but I think the craving for dividends overshadowed what would have been the impact of the elections,” he said.