NGX Bank Index Raised Stock Market By N1.08tn
Despite investors’ sentiment trading and uncertainty surrounding the 2023 general elections, the anticipation for dividend payout and sectoral performance of the NGX banking index raises the stock market capitalisation by N1.08tn in January.
The market capitalisation of all listed stock on the Nigerian Exchange closed trading at N28.998tn on January 31, 2023, an increase of N1.08tn from N27.915tn it closed for trading in 2022.
Also, the NGX the All-Share Index rose by 3.88 per cent or 1,987.61 basis points to 53,238.67 basis points, 1,987.61bps or 3.88 per cent from 51,251.06 basis points it closed for trading in 2022.
This performance was boosted by NGX Banking Index appreciated by 7.5 per cent to 448.85basis points from 417.50 basis points it closed in 2022, while NGX Insurance rose by 5.4 per cent to 183.71basis points as of January 31, 2023, from 174.36 basis points it closed last year.
Capital market analysts said the market so far in 2023, had witnessed sentiment trading by investors, stressing that anticipated dividend payment contributed to the 2.74 per cent growth in the month under review.
The Head, Capital Markets and Treasury at Dash, Ayotunde Alabi, said the anticipation for dividends payout and bargain hunting drove the market performance.
He said, “The anticipation of dividend payouts by companies. Most investors are trying to partake in the dividends that the companies are going to payout during the first quarter.
“And some other investors believed the market has sold to that point where they can tap into supreme bargain hunting.
“They feel the right time to buy is when there are sellers in the market so that they can make more money when everything settles down.”
Analysts at Investment One in a report titled, “2022 review and 2023 macro-economic and financial market outlook” also said the direction of market performance would be largely determined by the trio impact of fixed income yields in tandem with monetary policy, corporate actions, and election turnouts.