Nigeria's markets cap hits year high

Nigeria's Stock Exchange saw a positive trajectory this week as the market capitalization hit a new year high of over 13 trillion naira. The Orchered Index closed in positive territory for the third consecutive session, crossing the 38,000 points mark. Top gainers included Nestle, Guinness, Presco, PZN, GT Bank, and Sir Primarily, with consumer goods stocks leading the gains. On the flip side, Con Oil, ETI, Unilever, and Dangote Sugar were among the top losers, also in the consumer goods sector. The market's performance has been notable, with Baba Ibrahim, Managing Director at Main Street Bank Securities, commenting on the recent trends. Despite the positive outlook, Ibrahim noted a decline in trading volumes over the past three weeks, attributing it to investors awaiting the audited financial results of banks. The anticipation for the results has impacted trading volumes, especially for stocks like Nestle with limited floats. Nestle emerged as investors' favorite, gaining traction with a remarkable rise in share price from below 600 naira to 1154.93 naira. This surge was driven by the company's strong H1 performance, with profits soaring to 16 billion naira. The market responded positively to Nestle's performance, signaling renewed interest in the equity. Guinness, another key player in the market, witnessed a significant turnaround as it reported losses in 2016 but has since rebounded. The company's share price rose by over eight naira, bolstered by factors such as the increasing price of Nigerian Breweries shares and a successful rights issue. Investors have shown increased interest in Guinness, reflecting a shift in sentiment towards the company. The consumer goods sector, traditionally considered a safe haven, has faced challenges in recent times. Despite market volatility, investors have favored financial services stocks over consumer goods. However, there are signs of a shift as the consumer goods index shows positive growth year-to-date. Factors such as stabilizing market conditions and government support for the sector are driving renewed attention to consumer goods stocks. Overall, Nigeria's stock market is witnessing dynamic shifts in investor sentiment and sectoral performance. With companies like Nestle and Guinness leading the charge, the market's resilience and potential for growth are evident. As the year progresses, market participants will closely monitor these developments to gauge the market's trajectory and investment opportunities.