Nigeria’s equities market defied expectations from last Tuesday’s monetary policy rate (MPR) hike to 13percent which makes fixed income securities attractive.
Investors stayed in the stock market in major part of the review trading week ended Friday, May 27 buying counters like Airtel Africa Plc which contributed majorly to the record gain of about N595billion.
The market gained in three (3) trading days of the review week as against two (2) days of loses, pushing this month’s positive return higher by 8.96percent, while its year-to-date (YtD) positive return also increased to 26.61percent.
Equities market closed the review week on a positive note as buy-side activity level remained elevated. Despite mid-week expectation that investors will start to hunt for higher yields in fixed income (FI) market, they chose to take advantage of price dip in some of the fundamentally sound names in the stock market.
Week-on-week (WoW), the Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation increased by 2.09percent to 54,085.3 points and N29.157trillion respectively as against week-open lows of 52,979.96 points and N28.562trillion.
Read also: Nigeria stocks defy rate hike, gain N302bn
As the market continues its rally, Temi Popoola, Chief Executive Officer of NGX has asked investors to diversify their portfolios, adding that it would reduce their risks.
Popoola noted that in spite of the current appreciation in prices of equities in the country, opportunities still exist for investors in other assets classes. He said as a multi-asset Exchange, NGX has various products for every investor regardless of what their investment goals, risk appetite or return expectations might be, listing the products as equities, fixed income, Exchange Traded Funds and Derivatives.
According to him, there are opportunities in every segment of the market. “It is important for investors to do the analysis, understand where those opportunities are, as there are opportunities, not only in the equity side but across the various asset classes”.