By Dipo Olowookere
The desire to hedge against inflation has forced some investors back into the equity market, resulting in an increase in their participation in the landscape in the second quarter of 2022 when compared with the first quarter of the year.
According to data from the bourse, in Q2 of 2022, both local and foreign investors traded N485.4 billion worth of stocks on the Nigerian Exchange (NGX) Limited compared with the N346.4 billion traded in Q1 of 2022, indicating an increase of 40.11 per cent.
It was also gathered that in the period under review, traders bought and sold 54.3 billion equities, 143.83 per cent higher than the 22.3 billion equities transacted in the first three months of the year. In the same vein, the number of deals rose by 8.5 per cent quarter-on-quarter to 320,778 trades from 295,533 trades.
It was observed that the major attraction was some stocks with sound fundamentals as investors take a position in companies paying interim dividends as the market looks forward to half-year earnings of listed firms this month.
As a result of the buying pressure, the All-Share Index appreciated by 10.3 per cent to 51,817.59 points in Q2 2022 from 46,965.48 points in Q1 2022, while the market capitalisation grew to N27.94 trillion from N25.31 trillion.
While commenting on the trading data, the chief executive of Wyoming Capital & Partners, Mr Tajudeen Olayinka, noted that improved liquidity in the system in the last six months is responsible for the positive performance of the Nigerian stock market.
Other factors driving liquidity in the equities market, he added, are “instant payment of dividends to shareholders through electronic means (e-dividend), provides opportunities for immediate reinvestment of these dividends, especially by institutional investors, who manage funds and portfolios for clients.
“This did not leave out other traditional investors, who took advantage of low prices, in the run-up to financial year-end rallies that we saw at the beginning of the year 2022.”
He further attributed the buying interests to the “negative real return in the fixed income market and the need to hedge against inflation.”
According to him, “Equity market is an inflation adjusting market, and so, some investors who were willing to hedge against inflation, irrespective of the downside risk that the market poses, decided to bring liquidity back to the equity market.”
“The ongoing crash in the crypto market brought liquidity back to the equity market. It has been said that more Nigerian investors participate actively in the crypto space, and so, the sudden, though long expected crash in that market, made some affected Nigerian investors cut their losses, for less volatile and recoverable opportunities in the equity market.
“Availability of derivative products is encouraging more institutional investors to embrace the equity market. Investors can now short or long the market at ease. All these activities provide liquidity to the market,” Mr Olayinka further stated.
Business Post observed that in the period under consideration, the value of fixed income at the exchange rose by 38.7 per cent to N1.01 trillion from N728.9 billion reported in Q1 2022.
According to the data by the NGX, the volume of fixed income traded moved to 972,206.00 in Q2 2022 from 688,564 reported in Q1 2022, while its market capitalisation jumped to N22.23 trillion from N21.42 trillion.
Geregu Power to List Shares on Stock Exchange
By Aduragbemi Omiyale
The Nigerian Exchange (NGX) Limited will have a new member in the coming days as an electricity generating firm, Geregu Power Plc, is planning to list its shares on the platform.
According to regulatory documents, the company will list a total of 2.5 billion units of its shares at N100.00 per unit by way of introduction on the bourse, increasing the market capitalisation of the exchange by N250 billion.
The listing of these equities is expected on Wednesday and a ceremony to commemorate it will happen later this month.
“We look forward to hosting you at the exchange on October 25 or 26, 2022, for a closing gong ceremony to commemorate the listing,” a message to Geregu Power by the chief executive of the NGX, Mr Temi Popoola, read in part.
Geregu Power has Mr Femi Otedola as its majority shareholder. He left the stock exchange a few years ago after he sold his holdings in the defunct Forte Oil Plc, a company rebranded to Ardova Plc by the new owner, Mr Abdulwasiu Sowami.
Multiverse Stocks Rise 30.85% in One Week
By Dipo Olowookere
Investors renewed their interests in the shares of Multiverse Mining and Exploration Plc last week, pushing the price higher by 30.85 per cent to N3.69.
Another stock that attracted attention in the week was the Nigerian Exchange (NGX) Group Plc, as investors pushed aside the recent corporate governance issues raised in the media and keyed into the company’s dividend policy.
At the close of the five-day trading week, its price rose by 17.65 per cent to N20.00. Jaiz Bank grew last week by 15.38 per cent, Cadbury Nigeria expanded by 14.77 per cent, while Eterna improved by 9.91 per cent to N6.32.
However, the shares of Neimeth fell by 10.26 per cent to N1.40, Nestle lost 10.00 per cent to N1,215.00, Africa Prudential dropped 9.91 per cent to N5.00, Royal Exchange depreciated by 9.80 per cent to 92 Kobo and Fidson went down by 9.05 per cent to N9.05.
At the close of transactions for the week, 25 equities appreciated, higher than 17 equities in the previous week; 33 equities depreciated, lower than 42 equities in the previous week; while 98 equities remained unchanged, higher than 97 equities recorded in the previous week.
Business Post reports that the All-Share Index (ASI) depreciated by 0.01 per cent to close the week at 49,024.16 points, while the market capitalisation appreciated by 0.03 per cent to close at N26.451 trillion.
Similarly, all other indices finished lower except for NGX Main-Board, NGX 30, oil/gas and industrial goods indices, which appreciated by 0.25 per cent, 0.04 per cent, 0.20 per cent, and 3.01 per cent, apiece as the ASeM, growth and sovereign bond indices closed flat.
During the week, a total of 1.005 billion shares worth N10.406 billion were traded in 17,844 deals as against the 562.856 million shares valued at N9.438 billion transacted in 16,013 deals a week earlier.
A total of 757.289 million financial shares valued at N6.947 billion were traded in 9,483 deals in the week, accounting for 75.38 per cent and 66.76 per cent of the trading volume and value.
A total of 75.118 million units of conglomerate stocks worth N82.955 million exchanged hands in 494 deals, as 50.186 million units of consumer goods shares worth N1.457 billion were transacted in 2,798 deals.
Jaiz Bank, GTCO and Zenith Bank were the most active stocks as they traded 460.216 million units worth N4.963 billion in 4,281 deals, contributing 45.81 per cent and 47.69 per cent to the total trading volume and value, respectively.
Nigeria’s Crude Oil Exports Jump 88.6% to N11.53trn in Six Months
By Adedapo Adesanya
Nigeria earned N11.53 trillion from the export of crude oil in the first half of 2022, according to the latest data released by the National Bureau of Statistics (NBS), jumping by 88.6 per cent compared with N6.11 trillion recorded in the first half of 2021.
In its Foreign Trade Statistics for the Second Quarter of 2022, the NBS noted that crude oil export in the first six months of 2022 accounted for 79.47 per cent of total exports in the period under review, while it also accounted for 44.62 per cent of total trades in the same period.
Giving a breakdown of crude oil exports in the first half of 2022, the NBS stated that in the first quarter of the year, crude oil valued at N5.621 trillion was exported by the country, while in the second quarter, N5.908 trillion was exported.
In comparison, in the first quarter of 2021, the NBS said Nigeria earned N2.043 trillion from crude oil exports, while in the second quarter, N4.072 trillion crude oil export sales were recorded. Furthermore, in the third and fourth quarters of 2021, Nigeria recorded crude oil export of N4.026 trillion and N4.269 trillion, respectively.
The country’s statistical authority put Nigeria’s total trade in the first half of 2022 at N25.843 trillion, comprising N13.001 trillion and N12.841 trillion in the first and second quarter of the year, respectively; while total export trade for the first half of 2022 stood at N14.507 trillion, with N7.1 trillion and N7.407 trillion export recorded in the first and second quarter respectively.
Specifically, the NBS reported that in the second quarter of 2022, crude oil ranked as the most exported commodity in the country, with 79.77 per cent of the country’s total export.
Furthermore, the statistics agency stated that the most of Nigeria’s crude oil export in the second quarter of 2022 was to European countries, with the continent purchasing Nigeria’s crude oil valued at N2.737 trillion; followed by Asia, with N1.916 trillion; while countries in America purchased N861.937 billion.
Africa accounted for N355.853 billion of Nigeria’s crude oil export, while N36.459 billion worth of Nigeria’s crude oil was exported to Oceania.
India emerged as the highest buyer of Nigeria’s crude oil, with N1.009 trillion worth of the commodity shipped to the country in the second quarter; followed by the Netherlands, with the purchase of N886.314 billion worth of Nigeria’s crude oil; while N854.859 billion crude oil was exported to Spain.
Other major crude oil export destinations were Indonesia, N614.954 billion; United States, N488.356 billion; Italy, N253.817 billion; Sweden, N232.152 billion; Canada, N226.704 billion; France, N192.273 billion and Ivory Coast, N191.425 billion.
Latest News on Business Post
- Geregu Power to List Shares on Stock Exchange October 3, 2022
- UNGA 77 Aftermath: AfDB Priorities Climate Finance, Jobs, Food Insecurity October 3, 2022
- La Liga News: Atletico Madrid vs. Real Madrid October 3, 2022
- Multiverse Stocks Rise 30.85% in One Week October 3, 2022
- Nigeria’s Crude Oil Exports Jump 88.6% to N11.53trn in Six Months October 3, 2022
- Purchasing Managers’ Index Hits Five-Month High of 53.7 October 3, 2022
- Value of NASD OTC Exchange Rises by N16.09bn in Week 39 October 3, 2022
- Highest Paid Nigerian Footballer – How Much Do Nigerian Footballers Earn October 3, 2022
- Nigeria Inaugurates Mini Grids Programme to Expand Clean Energy Access October 3, 2022
- Nigeria Re-Elected to ICAO Council for 15th Time October 2, 2022