- Investors gain N101bn as stock market index rises by 0.18%
The International Monetary Fund has said that Nigeria’s foreign reserves dropped to a record low of $24 billion in 2024 from $33 billion last year.
The IMF’s latest country report for Nigeria disclosed this, signaling potential challenges for Africa’s largest economy.
It noted that the first half of 2023 witnessed a surplus in the current account, yet there was a notable decline in reserves.
“Through 2024–25, the financial account will likely deteriorate, with no projected issuance of Eurobonds, large Fund and Eurobond repayments of $3.5 billion, and portfolio outflows.
“Hence, despite a current account surplus, officially reported reserves are projected to decline to $24 billion in 2024 before increasing again to $38 billion in 2028 as portfolio inflows resume,” the report stated.
However, the Central Bank of Nigeria data showed Nigeria’s foreign reserves stood at $33.12 billion as of February 8, 2024.
Investors gain N101bn as stock market index rises by 0.18%
In another development, investors in the equities market gained N100.7billion as market capitalization closed at N55.84 trillion after trading on Monday.
Opening the week, the local bourse extended gains from the previous session, as the benchmark index closed 0.18 percent stronger to settle at 102,042.32 points. Buy interests in BUAFOODS (+1.05%), GEREGU (+6.75%) and ZENITHBANK (+0.14%) outweighed selloffs in GTCO (-0.37%), UBA (-1.18%) and ACCESSCORP (-6.26%), leaving the market in the green.
Consequently, the year-to-date return rose to 36.47 percent.
Analysis of Monday’s market activities showed trade turnover settled lower relative to the previous session, with the value of transactions down by 30.31 percent.
A total of 242.43bn shares valued at N5.13bn were exchanged in 8,715 deals. ACCESSCORP (-6.26%) led the volume chart with 24.90m units traded while GTCO (-0.37%) led the value chart with deals worth N841.25m.
Market breadth closed positive at a 1.30-to-1 ratio with advancing issues outnumbering the declining ones. CHAMS (+10.00%) topped twenty-nine (29) others on the leader’s table while INFINITY (-9.90%) led twenty-two (22) others on the laggard’s log.
Last week witnessed a notable correction in the local bourse, marking the first downturn in 16 weeks, propelled by sell sentiments, particularly from institutional investors.
The benchmark index plummeted by a substantial 2.45 percent week-on-week to 101,858.37 index points, as profit-taking activities dominated the market amidst weak breadth and elevated volatility.
Consequently, the year-to-date return of the index settled at 36.22 percent, contributing to a 2.59 percent weekly decline in the market capitalization of listed equities to N55.74 trillion coupled with the recent delisting of GlaxoSmithKline’s shares from the daily official list of the NGX.
This resulted in a total of N1.42 trillion being wiped off the market as investor sentiment waned across the board.
Stock market analysts have anticipated the current bearish trend to persist this week as investors seek refuge in fixed–income instruments due to the high yields as seen recently amid dividend expectations and high market volatility ahead of the January Consumer Price Index data from the NBS and the impending Monetary Policy Committee meeting this February.
However, a pullback at this juncture is expected to strengthen upside potential. Amidst all these, experts continue to advise investors to take positions in stocks with consistent track records of dividend payments and strong fundamentals and growth prospects to support earnings growth.
