Gains recorded mostly in banking, consumer goods and oil and gas sectors of the equities segment of the Nigerian Stock Exchange lifted the benchmark index up on Thursday.
The All Share Index appreciated 0.91 per cent to close at 25,865.06 points, as against the decline of 0.06 per cent recorded the preceding day to close at 25,630.62 points.
Market capitalisation shed N91 billion to close at N8.900 trillion, in contrast to the depreciation of N2 billion recorded the preceding day to close at N8.819 trillion.
Investment analysts at DLM Securities noted that the rally in the oil and gas sector suggested investors’ positive reaction to the deregulation of the downstream oil sector.
“While we note an increasing number of domestic investors’ participation in the market, however, investors entering the market should be cautious and invest with a long-term orientation to minimize the risk of near-term underperformance.
“While market performance is driven by valuations and earnings growth, in the current scenario, valuations appear cheap despite anticipated poor earnings growth for the year.
“In our view, pickup in earnings growth depends largely on the speed with which government economic and policy reforms are implemented,” the firm said.
Another investment analyst at United Capital said the renewed investor interest in downstream oil and gas counters following the announcement of the removal of petroleum subsidies was a key driver of market momentum, as the sector recorded the biggest gains.
“We expect further appreciation on these names with possible knock-on impacts on the overall market direction in the coming trading sessions,” the firm said.
The appreciation recorded in the share prices of Nigerian Breweries, Oando, United Bank for Africa, Forte Oil and Zenith Bank were mainly responsible for the gain recorded in the Index.
The total value of stocks traded was N1.49billion, down 6.82 per cent from N1.60billion recorded the preceding day.
The total volume of stocks traded was 261.94million in 3,457 deals, while the three most actively traded stocks were Transcorp, FBN Holdings and First City Monument Bank.