Domestic and foreign investors? transactions in Nigeria?s stock market neared 2008 level, reaching N4.470 trillion in 10 months to October 2024, driven mainly by banks? capital raise and new listings.

Domestic investors? transactions reached a record high of N3.726 trillion in 10 months, nearing the 2008 level when the transactions stood at N3.971 trillion. Similarly, foreign investors? equities deal was N744.34 billion, approaching N787 billion recorded in 2008.

The total value of stocks traded on the Nigerian Exchange Limited (NGX) in 10 months to October represents a remarkable year-on-year (YoY) increase when compared with N2.933 trillion recorded in the corresponding period of 2023, according to recently released NGX trading data.

Many banks have approached the recapitalisation journey through public offer, rights issue or a combination of the two.

?The equity market is being asked to raise in the region of N3 trillion in capital increases for the banks. It sounds like a tall order, but we think the money will be raised,? Coronation research analysts said on a July 29 note.

Successful raises at the capital market this year are: FCMB (N110 billion), GTCO (N400.5 billion), Access Bank (N351 billion), Fidelity Bank (N127.1 billion), Sterling Bank (N28.8 billion), and Zenith Bank (N290 billion). FBN Holdings rights issue of N150 billion is ongoing, while UBA and Stanbic IBTC have gotten approvals for their N239.4 billion and N150 billion rights issues respectively.

Foreign inflows into Nigeria?s stocks stood at N344.30billion as at October 2024 as against N122.6 billion in October 2023.

Foreign outflows stood at N400.04 billion as against N168.83 billion in the same period of 2023.

In same period, domestic retail investors accounted for stocks deal worth N1.909 trillion as against N935.78billion in October 2023.

Domestic institutional investors accounted for N1.816 trillion worth of equities in 10 months to October, 2024. This is against N1.706 trillion in October 2023.

The Nigerian Exchange Limited recently listed the shares of Haldane McCall Plc by introduction on the Main Board of the NGX. Haldane McCall listed its 3.122 billion ordinary shares of 50 kobo each at N3.84 per share. Other newly listed stocks from January till date that helped power the growth at the Nigerian bourse include: Aradel Holdings Plc which listed by Introduction on October 14.

The company listed its 4.344 billion shares on the NGX Main Board at N702.69 per share. The added N3.053 trillion to equities market capitalisation. Also, Transcorp Power Plc. listed its 7.5billion shares at N240 per share by Introduction on March 4, 2024.

The stock market has risen by 30.83 percent this year, according to NGX trading data as at the trading week ended Friday November 22.

?Looking forward, the equities market is expected to retain its buy interest as investors cherry-pick undervalued stocks. However, given the high interest rates in the fixed income and money markets, we expect some bearish undertone to persist in the equities market as fixed income biased investors take advantage of the high yields in the fixed income space,? according to United Capital research analysts in their November 25 note to investors.

Nevertheless, they believe that the bulls will remain incentivised to persist in bargain hunting, ?given the tremendous mid-long-term opportunities in the equities market. Fund managers and businesses may entertain mid-long-term (?3 months) investment objectives, cherry-picking only sound equities with strong fundamentals and ongoing/pending corporate actions. This strategy will maximise market opportunities, thereby optimising portfolio returns.?

In view of the Monetary Policy Committee (MPC) meeting, Lagos-based Meristem research analysts noted the continued attractiveness of the fixed-income market. However they did not foresee significant capital outflows from the equities market.

?This week, we anticipate increased investor interest in attractively priced stocks as market participants seek to maximise capital gains opportunities ahead of year-end. This optimism is expected to bolster positive sentiment across the equities market,? according to Meristem research analysts in their recent note.

Month-to-Month Transactions

A breakdown of the NGX monthly stock market transaction shows that in January 2024, stocks worth N651.52billion were traded as against N195.10billion traded in January 2023. In February 2024, investors traded stocks valued at N357.88 billion worth of stocks as against N188.91 billion traded in February 2023.

Also, in March 2024, investors exchanged stocks worth N538.54 billion (March 2023: N146.22billion). NGX transaction data also showed that in April 2024, stocks worth N346.23billion were exchanged (April 2023: N191.21billion).

In May 2024, equities valued at N355.38 billion were exchanged (May: 2023: N322.92billion). In June 2024, stocks worth N354.55billion were exchanged (June 2023: N406.75billion), while in July, 2024, equities valued at N491.61 billion were exchanged as against N702.98 billion in the same period of 2023.

As at August 2024, equities valued at N379.52 billion were traded as against N262.56 billion exchanged in August 2023.

In September 2024, N493.01billion worth of stocks were traded on the NGX as against N295.80billion in September 2023, while in October 2024, investors traded stocks worth N502.73 billion, a remarkable year-on-year (YoY) increase from October 2023 low of N220.94 billion. (BusinessDay)

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