By Peter Egwuatu
At the backdrop of delayed approval of banks’ audited results for the full financial year 2023 by the Central Bank of Nigeria, CBN, the stock market investors are betting on the outcome as the apex bank’s Monetary Policy Committee, MPC, meets today and tomorrow.
The outcome of the meeting which will be announced tomorrow is expected to influence investment decisions on some major sectors of the market, but particularly on the financial sector.
Analysts have emphasised that the delayed approval of banks’ results is already affecting investors’ sentiments and confidence in the sector and extended to the overall market.
According to them, it appears that the MPC has sacrificed the economy on the altar of attracting foreign inflows for improved foreign exchange supply that will help address FX challenges.
The FX prioritization has already secured a quick win as CBN, last week, cleared all the FX backlogs and naira has started appreciating while the nation’s external reserve is also looking up after many months of decline.
Meanwhile, analysis of the market performance showed that the Nigerian stock market, Week on Week, W/W, down by 0.42%.
Specifically, the Nigerian Exchange Limited, NGX All Share Index, ASI a major performance indicator dropped to 104,647.37 points from 105,085.25 the previous week.
Similarly, another stock indicator, the NGX market capitalisation, which reflects the total value of investment on the Exchange reduced to N59.168 trillion from N59.416 trillion the previous week.
Over the course of the week under review, losses in MTN Nigeria which declined by 12.25% W/W, Dangote Sugar 3.67% W/W and Transcorp 0.32% W/W, outweighed buy interests in First Bank Nigeria Holdings, FBNH, which gained 4.46% W/W, UBA 11.11% W/W , and Access Corporation 4.35% W/W to drive the market’s negative performance.
Consequently, the Year-to-Date (YtD) return on the index slipped to 39.95%.
Commenting on market outlook, analysts at InvestData Consulting Limited, said: “We expect a mixed sentiment and profit taking to continue as players await the release of more corporate earnings with dividend possibility ahead of next MPC meeting, while Investors take advantage of low valuation to position and rebalancing portfolio. This is amid the volatility and pullbacks that add more strength to upside potential. As such, investors should take advantage of price correction. Also looking at the trends and events across the globe and domestically.”
Source: Vanguard
