Naira redesign, portfolio rebalancing help NGX All-Share Index to 8.72% gain in November

Nigeria’s equity market, represented by the All Share Index, snapped a 5-month losing streak to close the month of November with a gain of 8.72%.

Stocks closed the month of November on a bullish run as the NGX All-Share Index (ASI) and Market Capitalization appreciated by 8.72% to 47,660.04 and N25.959 trillion, respectively.

This is despite several negative headwinds coming into November, with stocks having tanked 10% in October. During the month, Nigeria witnessed a rise in the inflation rate, another interest rate hike, and foreign exchange volatility.

After getting to a record low in October, the market is now on a recovery path having suffered a massive price correction on Airtel, as investors rebalance their portfolios ahead of the year-end.

The ASI rose to as high as 54.085.30 on May 27, 2022, but has since in the past six months dropped by 6,425.26 basis points or 11.88%.
Market performance: Data obtained by Nairametrics showed that activities on the Nigerian Exchange opened the month with N23.877 trillion worth of market capitalisation and 43,839.08 index points.

It, however, closed on November 30, 2022, at N25.959 trillion and 47,660.04 index points, and as such has earned a month-to-date gain of about N2.082 trillion or 8.72%.

Further analysis showed that the NGX Industrial Index led with 13.16% terms of growth in November to 2,137.21 points from 1,888.51 points it opened for trading during the month.

Banking Index followed with a growth of 5.79% to 396.71 points from 375.01 points it opened for trading in November.

Despite the perception that pre-election years are usually characterized by negative sentiments which also results in the exit of foreign investors, market experts believe that crave for institutional investors to rebalance the structure of their portfolio towards the end of the year and CBN’s policy to redesign the Naira are some of the major factors propelling the equities market on the green trajectory.