Investors gain N167bn as Nestle, others help market defy rate hike

Nigeria’s equities market furthered its northward development on Wednesday, rising by 0.58percent or N167billion to defy charge hike by the Financial Coverage Committee (MPC).

The Central Financial institution of Nigeria (CBN) on Wednesday after the two-day Financial Coverage Committee (MPC) assembly, the final underneath President Muhammadu Buhari’s administration, raised its benchmark rate of interest also referred to as the Financial Coverage Fee (MPR) by 50basis factors to 18.5percent.

The Nigerian Alternate Restricted (NGX) All-Share Index (ASI) and equities market capitalisation elevated farther from previous day’s low of 52,621.19 factors and N28.652trillion respectively to 52,927.60 factors and N28.819trillion.

Because of shares like Nestle Nigeria which rose most, from N1,043.80 to N1,148, including N104.20 or 9.98percent. Additionally, UACN rallied from N8.20 to N9, including 80kobo or 9.76percent; whereas Tripple Gee and Firm elevated from N3.24 to N3.56, including 32kobo or 9.88percent. College Press made the highest advancers league, after rising from N2.05 to N2.25, including 20kobo or 9.76percent.

Additionally, the market’s optimistic return year-to-date (YtD) elevated additional to three.25 p.c.

Learn additionally: FMDQ says April secondary market turnover drops to N12.55trn

Banking shares have been most traded on Wednesday as Entry Company, UBA, Zenith Financial institution, Constancy Financial institution and GTCO topped the league of actively traded shares.

Africa’s greatest economic system noticed its Gross Home Product (GDP) develop by 2.31 p.c (year-on-year) in actual phrases in first-quarter (Q1) 2023, down from 3.52 p.c in This autumn 2022 and three.11 p.c in the identical interval final 12 months, in accordance with the Nationwide Bureau of Statistics (NBS).

“The Nigerian economic system was negatively impacted by the Naira liquidity crunch of first-quarter (Q1) 2023, which had a extra telling impact on the casual economic system and resulted in moderated GDP development of two.31percent (versus 3.52percent in This autumn’2022). The tamer development is behind our projection of two.6percent and Bloomberg’s consensus of two.8percent.

“This end result can also be in line with the indications supplied by high-frequency knowledge, such because the Buying Managers’ Index (PMI) and enterprise confidence surveys, which pointed to a major contraction in financial exercise through the evaluate interval,” mentioned CardinalStone Analysis analysts of their Could 24 be aware.

Analysts at Lagos-based Meristem analysis had earlier this week mentioned they count on the optimistic temper out there to persist this week, “contemplating the enticing upside on tickers which traders ought to make the most of”. Although they didn’t rule out the potential of profit-taking actions on tickers that had gained within the earlier weeks, they nonetheless count on the overriding sentiment out there to be bullish.