Equities Investors Pocket N608bn as NGX Rallies 1.06% Amid Portfolio Rebalancing

Samuel Mobolaji

Investors saw significant gains last week, with the Nigerian stock market adding a hefty N608 billion to its market capitalization. The NGX All-Share Index climbed by 1.06 per cent, driven by strategic portfolio rebalancing and tactical position-taking in fundamentally strong stocks, positioning investors to reap continued rewards in the coming trading sessions.

Last week’s market rally was fueled by investor optimism surrounding key macroeconomic data, including anticipated Consumer Price Index (CPI) data and the upcoming Monetary Policy Committee (MPC) meeting.

Data from the NGX, showed that these factors, alongside expectations of robust corporate earnings from dividend-paying banks, contributed to the market’s positive momentum.

Banking stocks led the charge, with the NGX Banking Index posting a remarkable 5.12 per cent gain week-on-week, drawing in savvy investors who capitalized on opportunities for interim dividend payouts. Oil and gas stocks also contributed, with a 2.00 per cent increase, while consumer goods and industrial sectors made smaller yet significant strides.

Despite profit-taking, the pullbacks offered bargain hunters further entry points into value stocks, with portfolio repositioning driving trading volumes. Over 2.584 billion shares were traded, worth N51.205 billion, a slight dip from the previous week’s figures, but still signaling strong investor interest.

Top-performing stocks like Caverton Offshore, R.T. Briscoe, and UPDC drove the week’s gains, while Learn Africa, Julius Berger, and PZ Cussons led the decliners. Market breadth remained positive, with 52 stocks appreciating compared to 31 decliners, affirming the market’s upward trajectory.

With N608 billion in fresh market capitalization and investor sentiment running high, the Nigerian equities market remains ripe for continued gains this week, offering potential opportunities for further profit-taking and strategic portfolio adjustments.

Meanwhile, analysts at Cowry Assets Management Limited said, “as Nigeria’s macro landscape continues to evolve, the bourse is poised for further activity in reaction to the changing fundamentals and technicals even as we expect continued volatility and entry opportunities for savvy investors.

“Looking into the coming week, we expect positive sentiment to rule the local bourse in the coming week on portfolio rebalancing, and position taking in value giving and fundamentally sound stocks given the relative strength of the market index trading above the T-line. Nevertheless, we continue to advise investors to focus on fundamentally sound stocks.”

On market outlook, the chief operating officer of InvestData Consulting Limited, Mr. Ambrose Omordion said, “we expect mixed sentiment to continue on profit taking and bargain hunting in the hope of an inflow of the half-year numbers from the other interim dividend paying stocks, as sector rotation continues in the market. Portfolio repositioning is however continuing, with investors taking advantage of pullbacks to buy into value.”

He noted that, “this is amid the volatility and pullbacks that add more strength to upside potential. Consequently, investors should take advantage of price correction. Also looking at the trends and events across the globe and domestically.”