The Nigerian Exchange All Share Index closed trading on Tuesday, July 11th at 65,669.29, crossing the end of month all-time high end of month point recorded in February 2008.
The previous end of month high for the stock market was 15 years ago or February 2008 when it closed at 65,652.4, an era that is often recognized as the peak of the stock market boom of the early 2000s.
However, the record single day all time high for Nigerian stocks remains 66,671 achieved 5th March 2008.
2008 vs 2023
Why this matters: The stock market at the time was boosted by several private placements that went on to become initial public offerings, right issues, and public offers as investors raised money from a wealth-driven retail investor market.
- The market at the time was also buoyed by hundreds of billions of naira in margin lending which involved borrowing money from commercial banks to invest in the stock market using the equities as collateral.
- Inflows were a massive N4.6 trillion in 2008, the highest to date. Foreign and domestic participation was N3.9 trillion and N787 billion respectively.
- The market unraveled and eventually crashed, falling to as low as 19,825.1 by March 2009, the lowest point ever recorded since 2008.
What is different: This time around, there are no margin lendings or public offerings, or retail investor frenzy.
- What we have observed is a bull run that is driven by policy decisions viewed as positive for a stock market that has traded at low prices earning multiples for almost a decade.
- The bull run is being driven by investors, mega-billionaire moves, and foreign investors who are gradually returning to the stock market.
- A relatively successful election, revision of the forex policies to a managed float, and the removal of fuel subsidies have also boosted investment sentiments.
- We have also seen an increase in capital inflows in the stock market with about N1 trillion recorded in the first 5 months of this year compared to N1.5 trillion in the whole of 2022.
Despite the massive bull run being witnessed, capital inflows in the stock market are not expected to be at the same levels recorded in 2008 when the June report is released.
Nigerian Equities currently trade at a price-to-earnings multiple of 11.77x, higher than its emerging market peers of South Africa, Egypt, Kenya, and Ghana which trade at 10.57, 8.79x, 5.69x, and 3.19x respectively.
Daily Performance Report
The Nigerian equity market maintained its bullish trend as market capitalization increased by N580 billion at the close of trading today, 11th July 2023.
- The market was boosted higher by 1.65%, from N34.177 trillion in the previous day’s session to N35.757 trillion.
- The market has maintained a positive momentum for the past week, starting from Tuesday, 4th July 2023. This indicates strong confidence among investors and traders in the current economic outlook.
- The All-Share Index (ASI) rose by 1,065.6 points to close at 65,669.29 points on Tuesday, 11th June 2023 from the previous close of 64,603.69 points on Monday.
The market witnessed a sharp decline in the value of transactions, as the total value of traded shares fell to N9.41 billion, a 57.3% decrease from the previous session’s N22.03 billion.
Market Indices
Below are the market indices for today’s trading session:
NGX ASI: 65,669.29 points
% Day Change: 1.65%
% YTD: +28.13%
Market Cap: N35.757 trillion
Volume Traded: 844.72 million
Value: N9.41 billion
Deals: 8,922
How Stocks Performed
Today, the stock market experienced a major shift, with CHELLARAM leading the gainers with a 10.00% increase in its value.
- CHIPLC suffered the biggest loss with a 10% drop in its share price, and CHAMS recorded the highest volume of trade at the end of the market session.
- The trading volume was lower today, with 8,922 deals closed, down from 14,584 deals in the previous session, showing a decline in activity on the market.
Top Gainers and Top Losers
CHELLARAM, OMATEK, and SOVRENINS, all with a share price gain of 10%, dominated today’s stock market.
- These impressive gains surpassed those of other companies and lifted the overall market mood.
- Others however contributed to the market’s decline with CHIPLC, CHAMPION, and MCNICHOLS dropping 10%, 9.89%, and 9.33% respectively.
Top Traded Stocks
The trading volume today dropped to 844.72 million shares from 1.84 billion shares. This represents a 54% decline compared to the previous day.
- The top three equities on the market today in terms of trading volume were CHAMS, FCMB, and UNIVINSURE, with 91.71 million, 78.68 million, and 75.01 million units traded, respectively.
- UBA led today’s stock market trading with a value of N795.32 million, FCMB came in second with a value of N551.89 million, while TRANSCORP came in third with a value of N245.14 million.
SWOOTs Watch
The cement sector performed well, with DANGOTE CEMENT and BUA CEMENT rising by 9.27% and 6.59% respectively.
- However, the banking and telecom sectors declined, with UBA, ZENITH BANK, MTN NIGERIA, and GTCO losing 4.03%, 2.01%, 0.71%, and 0.28% respectively.
- AIRTEL AFRICA and BUA FOODS remained unchanged today, with the same closing values as yesterday. These companies showed a stable market performance, reflecting a balanced demand and supply.
FUGAZ Update
The stock market closed with negative returns for the leading banks today.
- The biggest losers were ACCESS HOLDINGS, UBA, FBNH, ZENITH BANK and GTCO, which declined by 4.5%, 4.03%, 3.59%, 2.01% and 0.28% respectively.
Update: This article was updated to clarify that the all time high is still 66,371.2 recorded March 15, 2008.