The market capitalisation of the Nigerian Stock Exchange (NSE) rose N2.22 trillion or 17.10 per cent in seven trading sessions with the market maintaining an upward trend since the beginning of 2020.
Data obtained by the News Agency of Nigeria (NAN) on Sunday showed that the market capitalisation, which opened on January 2 at N12.958 trillion rose by N2.22 trillion to close at N15.174 trillion on Jan. 10.
Also, the All-Share Index rose by 2,573.32 points or 9.59 per cent during the period to close at 29,415.39, compared with the opening year index of 26,842.07.
NAN reports that the nation’s bourse posted 9.1 per cent gain last week, the largest weekly return for two-years, to emerge the world’s best-performing stock market for the week.
Ambrose Omordion, the Chief Operating Officer, InvestData Ltd, attributed the growth to activities of investors who anticipate higher dividend yields.
“Local institutional investors and funds managers are taking advantage of the two consecutive years of decline to reposition their portfolios for the New Year expectations,” Mr Omordion said.
He stated that investors were optimistic that the current economic recovery would likely to continue, thereby resulting in enhanced dividend yields higher than the prevailing money market rates.
Mr Omordion added that the listing of BUA Cement of 33.86 billion ordinary shares at N35 per share contributed to the growth of the stock market.
He noted that the rise in oil price in the global market due to the conflict between the United States of America and lran contributed to the stock market trend.
Mr Omordion, however, said investors should not be carried away but set investment goal or target before jumping in any position whether for long or short term.
Moses Igbrude, President, Issuers and Investors Alternative Dispute Resolution Initiative, attributed the steady upward movement in the equities market to stability in political arena.
Mr Igbrude said the instability in the Middle East as a result of conflict between Iran and American increased foreign investors’ interest in the NSE.
However, analysts at Cordros Reseacher expect profit taking to dominate activities in the market this week.
“Looking ahead, while we expect profit-takers to dominate activities in the coming week, we still see significant legroom for a further rally as the elevated maturities from fixed income instruments hunt for investment vehicles.
“Nonetheless, we advise investors to cherry-pick fundamentally sound stocks,” they said.