The Nigerian Exchange (NGX) experienced a continued uptrend and bullish sentiment last week, driven by portfolio repositioning in anticipation of favorable third-quarter (Q3) 2024 financial reports from companies. Analysts attributed the positive sentiment to increased buying interest across major sectors of the market.
As a result, investors saw gains exceeding N835 billion, with the NGX market capitalization rising to N60.26 trillion from N59.425 trillion the previous week. The NGX All Share Index (ASI), a key performance indicator, surged by 1.4%, closing at 99,448.91 points, up from 98,070.28 points the prior week.
Notably, the market maintained a positive trajectory throughout all five trading sessions, spurred by strong demand for stocks such as Seplat, which rose 9.25% week-on-week (WoW), FBN Holdings with a gain of 10.58% WoW, and UBA, which increased by 18.50% WoW. However, there were notable sell-offs in MTN Nigeria, which saw a decline of 3.66% WoW, and Dangote Sugar, which fell by 10.13% WoW.
Analysts highlighted a rekindled confidence among investors, as corporate results released thus far have exceeded expectations, leading to a fourth consecutive positive outing that broke through the psychological barrier of 99,000 points. Companies such as Airtel Africa, CAP, UPDC, Guinness Nigeria, and Ikeja Hotel released their quarterly earnings reports, which displayed mixed results in their top and bottom lines.
According to analysts at InvestData Consulting, the current markup phase on the NGX is prompting discerning investors to reposition their portfolios toward sectors and companies expected to post positive earnings in their September quarterly reports. Looking ahead, the analysts anticipate that positive sentiment and a mixed trend will persist due to profit-taking and strategic positioning as more Q3 earnings reports are released. Sector rotation and portfolio rebalancing are expected to continue, with investors taking advantage of price pullbacks to acquire value stocks.
