The Nigerian stock market recorded a notable 3.2% gain in the week, driven by the recent enactment of the Insurance Industry Reform Act, strong second quarter (Q2) corporate earnings, and positive macroeconomic developments. The Nigerian Exchange Limited (NGX) All Share Index (ASI) closed at 145,754.91 points, up from 141,203.05 points the previous week, marking the eleventh consecutive week of bullish momentum.
Market capitalisation surged by over N2.214 trillion to close at N92.214 trillion, reflecting increased investor confidence. The market rally was largely supported by impressive gains in key stocks, particularly within the insurance sector where AIICO Insurance, Cornerstone Insurance, and NEM Insurance posted gains of 59.8%, 54.5%, and 29.9% respectively. Other notable performers included BUA Foods, Dangote Cement, and BUA Cement.
Trading activity showed mixed signals, with trading volume rising sharply by 80.2% week on week, while trading value decreased by 10.1%. Sector-wise, the Insurance Index led the gains with a 41.0% rise, followed by the Industrial Goods and Consumer Goods sectors, while the Banking sector was the only one to decline, dropping 0.8%.
Market analysts provided cautious optimism about the outlook. Cordros Research expects choppy trading in the short term as investors take profits but anticipate continued rotation into equities supported by moderating fixed income yields. Similarly, InvestData Consulting highlighted the positive impact of the Insurance Act and corporate earnings but advised investors to remain disciplined and monitor sector-specific earnings and macroeconomic factors closely.
Overall, the combination of regulatory reforms and robust earnings has strengthened market sentiment, positioning the Nigerian stock market for potential sustained growth despite some expected short-term volatility.
Source: Vanguard