Renewed investor confidence in Nigeria’s banking sector fueled a strong rally in banking stocks last week, with the sector index climbing by 9.3 percent on the Nigerian Exchange Limited (NGX). The impressive performance followed the successful completion of the banking sector recapitalisation exercise, which has encouraged investors to increase their exposure to banking equities in anticipation of stronger financial results.
The rally was largely driven by heightened demand for shares of First Holdco Plc and Fidelity Bank Plc, as market participants positioned ahead of the release of half-year earnings reports. Investors appeared optimistic that the recapitalisation drive would strengthen the financial standing of banks and improve their capacity for growth, making banking stocks one of the most attractive investment options on the market.
Beyond banking, the consumer goods sector also delivered a strong performance, advancing by 6.65 percent. Sustained buying interest in companies such as MCNichols and Vitafoam helped lift the sector. The insurance index posted a modest gain of 0.25 percent, supported by price appreciation in Wapic, Veritas Kapital, and Custodian, reflecting growing investor interest across multiple segments of the market.
Despite the gains recorded in some sectors, the overall market closed the week on a mixed note. The NGX All-Share Index slipped by 0.14 percent to settle at 243,462.13 points. However, market capitalisation rose by approximately N612 billion to N157.06 trillion following the listing of 13.812 billion additional ordinary shares by Sterling Bank. Market breadth remained positive, with 43 stocks recording gains against 34 decliners, underscoring continued investor appetite for selected equities.
Trading activity, however, slowed compared to the previous week as participation weakened. Investors traded 2.82 billion shares worth N182.78 billion in 227,002 deals. First Holdco emerged as the week’s best-performing stock with a remarkable 38.7 percent gain, followed by TIP at 27.2 percent and Fidelity Bank at 15 percent. On the downside, BUA Cement led the losers after shedding 19 percent, while Redstar Express and Jaiz Bank recorded losses of 18.5 percent and 15.3 percent respectively, highlighting the ongoing portfolio reshuffling taking place across the market.
source: The guardian
