Equity trading on the Nigerian Exchange Limited (NGX) finished the first month of the year (January) in the green territory as the NGX All-Share Index appreciated by 3.88% to close the final trading day with 53,238.67 index points.
Despite the rising inflation, interest rate hike, and naira redesign, equity investors increased their buying pressures on an expected impressive full-year 2022 corporate earnings results.
Data showed that the All-Share Index opened the trading year at 51,251.06 indexes on January 4, 2023. It then closed the month at 53.238.67 points, gaining 1,987.61 basis points or 3.88%.
Further analysis revealed that activities on the Nigerian Exchange Limited (NGX) which opened the trading year at N27.915 trillion in market capitalisation at the beginning of trading, closed on January 31st 2023 at N28.997 trillion, hence has earned a year-to-date gain of about N1.082 trillion.
Stock Market analysts believed the renewed sentiment in the local bourse market had also grown following crave to increase capital gains on the back of low prices of stocks owing to upset in the financial market arising unstable policies and building up to the 2023 general elections.
They further said that the price adjustment mechanism that the market is currently experiencing will continue during the first quarter of 2023. He added that it will make the market attractive.
The analysts explained that most results particularly the banking results would come in the first quarter and investors interested in dividends will swoop on the stocks.
They added that it is likely that investors will take a position to reap the dividend these companies will declare during the quarter.
Meanwhile, Analysts at Cordros Securities Limited said that they continue to expect investors to position for 2022 full-year results ahead of upbeat corporate earnings and re-investment of dividends to drive bullish sentiments in Q1, 2023.
“Nevertheless, in the latter part of the year, we believe that market sentiments will be shaped by a combination of the outcome of the 2023 elections, market-friendly policy or reforms, the direction of monetary policy, and impact on fixed income yields, sector-specific events and the weak macroeconomic environment,” they said.