September 2024 saw a strong close for equity trading on the Nigerian Exchange Limited (NGX), driven by an increase in investor confidence in listed companies.
The ASI demonstrated resilience in the face of multiple policy announcements from the Central Bank of Nigeria (CBN) intended to reduce rising inflation, which market analysts feared could have a negative effect on stock performance.
The ASI started the month at 96,579.54 points and ended at 98,558.79 points, indicating an increase of 1,979.25 basis points, or 2 per cent, according to data.
What is in for Nigeria as NGX ends September with massive gain? Along with growth, the market capitalisation increased, going from N55.477trn at the start of September to N56.635trn at the end of the month—a gain of roughly N1.15trn.
Both Mr Tunde Amolegbe, the former president of CIS, and Arthur Stevens Asset Management Limited, the managing director and CEO, have predicted major changes in the capital market for the second half of the year.
Amolegbe believes the market will be dominated by bank share issuance, which will be fuelled by the Central Bank of Nigeria’s (CBN) mandated banking recapitalisations.
“I believe the capital market in the second half of the year will be dominated by the issuance of shares by banks, in fulfilment of the banking recapitalizations mandated by the Central Bank of Nigeria (CBN). As a result, I expect primary market activities to take precedence over the secondary market,” Amolegbe stated.
He further noted that this trend could lead to a bearish market for the remainder of the year. Nonetheless, Amolegbe expressed confidence in the stability of the fixed-income market.
“I also anticipate that the fixed income market will remain stable, as the expectation is that the Monetary Policy Committee (MPC) might slow down its tightening stance with the slowing inflation rate,” he added.