By Melvin Onwubuke
The Nigerian Exchange has emerged as the number one exchange in Africa in the first two months of 2024, as investors enjoyed 33.70 per cent returns on investors.
This was revealed in a statement by the NGX on Tuesday that the local bourse was rated as the best-performing in Africa ahead of the Johannesburg Stock Exchange, Egyptian Exchange (EGX 30) Index and The Ghana Stock Exchange, according to The Punch.
In January, in the first three weeks of 2024, NGX emerged as the world’s best performing stock market beating Argentina and second place.
Between January and February, the market capitalization has appreciated by N13.79tn. The market cap of listed equities had opened the year at N40.917tn and closed February at N54.707tn.
Also, Similarly, the NGX’s All-Share Index, which is the benchmark index closed February at 99,980.30 points, marking an increase of 25,206.53 basis points or 33.71 per cent from 74,773.77 points it opened for trading this year.
Despite increased instability, inflation and volatile foreign exchange rates in the first two months of this year, as well as other national economic challenges and international uncertainties, the equity market has been performing strongly.
The market, which was bullish in January, producing N1tn cap companies fairly regularly, slowed in February as the bears reared their heads.
The bearish has been sustained amid lacklustre corporate earnings as well as better yields in the fixed-income market.
In his remark, the Managing Director of ARM Securities Limited, Rotimi Olubi, reiterated that the high fixed-income yield was driving traction from the equities market to the fixed-income market.
“We expect this to be sustained in the short term given the recent 400 basis points hike in interest rate.
“However, this presents an opportunity for investors to enter into the equities market at a cheaper price to lock in on dividend payments in the coming months.”
Meanwhile, the Chief Executive Officer of Wyoming Capital and Partners, Tajudeen Olayinka, said the stock market was in a repricing mode because of an interest rate hike and continued issuances of one-year Treasury bills at a high effective yield of over 20 per cent.
“So, we are witnessing a shift to the fixed-income market,” he said.
Recently, the benchmark interest rate has been raised to 22.75 % by the Central Bank of Nigeria’s Monetary Policy Committee.
