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22 Stocks Stretch NGX Index by 1.05% as Sentiment Turns Positive

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Trading of Stocks

By Dipo Olowookere

The Nigerian Exchange (NGX) Limited extended its rally for the second trading session on Wednesday, closing 1.05 per cent higher on the back of bargain hunting by investors.

The listing of BUA Foods on the exchange spurred buying interest, which, in turn, kept the bulls at the bourse for another day as the investor sentiment was better than the preceding session.

Data showed that a total of 22 stocks ended on the gainers’ chart, while 17 equities were on the losers’ log at the close of transactions for the day.

The duo of BUA Foods and Airtel Africa gained 10.00 per cent each to trade at N44.00 and N1,050.50 respectively, while Oando, AIICO Insurance and Ardova appreciated by 9.73 per cent, 8.33 per cent and 7.69 per cent each to settle at N4.85, 78 kobo and N12.60 apiece.

On the flip side, Unity Bank depreciated by 9.62 per cent to sell for 47 kobo, Royal Exchange lost 9.41 per cent to trade at 77 kobo, Regency Assurance fell by 8.16 per cent to 45 kobo, Union Bank dropped 6.90 per cent to quote at N5.40, while Mutual Benefits declined by 6.25 per cent to 30 kobo.

In terms of the performance of the five key sectors of the exchange, it was observed that the energy and insurance indices grew by 3.12 per cent and 0.85 per cent respectively, while the industrial goods, banking and consumer goods counters depreciated by 2.42 per cent, 0.50 per cent and 0.02 per cent respectively.

But at the close of business, the All-Share Index (ASI) rose by 760.31 points to 43,476.75 points from 42,716.44 points as the market capitalisation increased by N243 billion to N23.427 trillion from N23.184 trillion.

During the trading day, a total of 1.2 billion shares worth N43.0 billion were traded in 4,032 deals compared with the 216.7 million shares worth N1.5 billion transacted in 4,080 deals on Tuesday.

This showed that the number of deals went down by 1.18 per cent, while the volume of trades and the value of transactions went up by 472.75 per cent and 2,734.78 per cent respectively.

BUA Foods was the most traded stock at the midweek session and this was largely because of the cross deal it had. When the market closed for the session, it traded a total of 1.0 billion shares worth N40.5 billion.

Wema Bank sold 25.0 million stocks valued at N19.0 million, Transcorp exchanged 25.0 million equities for N24.6 million, NGX Group transacted 14.5 million shares worth N285.8 million, while UBA traded 14.0 million stocks valued at N112.2 million.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

NGX All-Share Index Outperforms Inflation Over Three Years

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All-Share Index

The 3-year trailing performance of the All-Share Index (ASI) of the Nigerian Exchange (NGX) Limited surpasses the average inflation during the same period.

The annual inflation measured by the Consumer Price Index (CPI) released in September by the National Bureau of Statistics (NBS) was 20.52 per cent in August 2022.

Meanwhile, the NGX ASI, a market capitalisation weighted index of all companies listed on the NGX’s platform, had a year-to-date performance of 15.68 per cent during the same period. This could be misleading about the market performance until you view it through a longer-term lens.

British Economist, Benjamin Graham, made a quote popularly used by Warren Buffett, the Fund Manager of Berkshire Hathaway Inc and widely regarded as the best living investor: “Markets are a voting machine in the short term, and a weighing machine in the long run.” On a 3-year trailing basis, the NGX ASI has outperformed the CPI average in the same period, ensuring that investors with a longer-term hold on their investments remain in the positive region.

Analysis of data of closing prices gathered from the NGX’s website showed that the index has a 3-year moving average of 22.97 per cent, compared to an inflation average of 15.72 per cent.

The year 2022 has been a slow year for global stocks due to volatility resulting from the hiking of interest rates by central banks in the United States and Europe amidst inflationary pressures.

The NGX ASI’s 15.62% YTD return is a significant positive performance compared to the US S&P 500, which has plunged by 22.46% or the FTSE 100, which has declined by 7.68%, according to Google Finance. The local bourse has exhibited resilience and insulated investors from negative return on investment over three years.

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Economy

Laolu Martins Was Minority Shareholder of Bukka Hut—Management

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Bukka Hut Laolu Martins

By Modupe Gbadeyanka

The management of an online restaurant in Nigeria, Bukka Hut, has clarified that one of its late directors, Mr Laolu Martins, was a minority shareholder in the company.

On Wednesday, it was reported that the deceased breathed his last in Lagos. He was said to have co-founded the firm with Mr Rasheed Jaiyeola, who is the Chief Executive Officer.

The deceased was reportedly invited to join the firm by Mr Jaiyeola, who jointly owns majority shares of the company with his wife and sister.

Mr Jaiyeola and Mr Martins were co-owners of the Nigerian International Securities Limited (NISL) before the former resigned from his position as director to focus on Bukka Hut in 2016.

According to the statement from the organisation, Mr Jaiyeola established Bukka Hut but only invited the deceased and two others to invest in the eatery when it was established.

“To clarify, Rasheed Jaiyeola is the founder/CEO of Bukka Hut, a proudly Nigerian brand he built from inception in August 2011 from one outlet to 24 outlets comprising of restaurants, lounges and suya and grill spots, and a learning facility, BH Academy, as at today. He jointly owns the majority shares of the company with his wife and sister.

“Bukka Hut is not a one-man business as there are two other shareholders/directors, but they are not involved in the daily management of the business.

“Rasheed and the late Olaolu Martins were co-owners of Nigerian International Securities Lid (NISL), and naturally, Laolu was one of the three people he invited to invest in Bukka Hut when he founded it in 2011; Rasheed resigned from NISL as a director in 2016 to focus solely on building Bukka Hut while Olaolu remained the MD/CEO of NISL and its related businesses,” the statement explained.

Mr Martins was reported to have died from suicide, but fresh information revealed that he slumped at Lenox Mall after a cardiac arrest and was taken to a hospital in Lekki, where he passed on.

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Economy

Usman Laments Nigeria, Saudi Arabia Trade Volume of $5m

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trade volume of $5m

By Aduragbemi Omiyale

The president of the newly-establishment Nigeria-Saudi Arabia Chamber of Commerce, Industry, Mines and Agriculture, Mr Ibrahim Usman, has lamented the low trade volume between both countries despite their historical relationship.

Mr Usman expressed this frustration when he visited the Minister of Information and Culture, Mr Lai Mohammed, at his office in Abuja.

He said at the moment, the trade volume between Nigeria and Saudi Arabia is about $5 million, promising to deepen the relations between the two countries.

“And whereas many Saudi investors are looking out for profitable investment windows in friendly countries like Nigeria, our businesses have been unable to capitalise on such opportunities due to lack of an organised, reliable, safe and very secure private sector platform like a chamber of commerce,” he said.

Mr Usman said a 60-member inter-ministerial delegation from Saudi Arabia will be in Nigeria next week for the second session of the Nigeria-Saudi Arabia Joint Commission, which will further create opportunities for the chamber to set up trade missions.

On his part, Mr Mohammed praised his guest for his effort to establish the organisation after over 10 years of trial, saying he has proven himself as a man of vision and deep conviction.

“Clearly from your presentation, it’s clear that the major objective is to change the narrative and ensure that the relations between Saudi Arabia and Nigeria should not be seen just from the narrow prism of Hajj and Umrah pilgrimage, but from the prism of two very important nations of the world creating a bridge through better cooperation for the two countries and their citizens,” the Minister said.

Mr Mohammed described the chamber as a clearing house for proposals from business people from the two countries in order to open new vistas for trade opportunities.

He said the absence of such a chamber has led to the decline in the volume of trade and also bred trust deficit between business people from the two countries.

“The absence of this vehicle has led to loss of businesses between the two countries and it has also aggravated the trust deficit between them,” he said.

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