The Nigerian equities market extended its bullish rally on Tuesday as the overall market capitalisation crossed the ₦71 trillion mark, driven by strong performances from Oando Plc and 30 other stocks.
At the close of trading, the All-Share Index (ASI) increased by 354.25 points or 0.32%, to settle at 112,781.73 points. Market capitalisation followed suit, adding ₦233 billion to close at ₦71.118 trillion, marking another milestone in the Nigerian Exchange (NGX).
The upward momentum was largely sustained by price appreciation in large and mid-cap stocks including Oando Plc, PZ Cussons Nigeria, Guaranty Trust Holding Company (GTCO), May & Baker Nigeria Plc, and First Holdco.
Oando emerged as the highest gainer of the day, appreciating by 10% to close at ₦51.70. Royal Exchange trailed with a gain of 8.64% to finish at 88 kobo, while Legend Internet climbed 7.27% to close at ₦5.90.
Other notable gainers included Lasaco Assurance, which rose by 6.67% to ₦3.20, and May & Baker Nigeria, which gained 6.56% to settle at ₦13.80.
Investor sentiment remained positive, with 32 stocks recording gains compared to 21 losers. Market breadth improved to 0.15x from 0.07x recorded in the previous session, according to analysts at Afrivest.
On the flip side, NCR Nigeria led the losers’ chart with a 9.89% decline to ₦5.92, followed by ABC Transports which dipped 9.83% to close at ₦2.95. Meyer Plc shed 9.63% to close at ₦8.45, Academy Press dropped 9.58% to ₦4.53, while Livestock Feeds lost 6.77%, closing at ₦8.95.
Despite the overall market rally, the oil and gas sector remains the worst-performing index on the NGX this year. The sector has posted a year-to-date (YTD) decline of 13.38%, a sharp reversal from its 24.07% gain recorded as of May 31, 2024.
This slump follows a remarkable 170% overall return in the 2024 financial year. Market observers attribute the sector’s current performance to a mix of profit-taking, delayed financial results, and weak dividend expectations.
Adding to the pressure is the increased competition from the newly operational Dangote Refinery, which has triggered a drop in petroleum prices and further squeezed profit margins for established oil firms.
Furthermore, the depreciation of the naira and rising foreign exchange (FX) losses have compounded the woes of oil and gas companies. For instance, Aradel Holdings reported a net FX loss of ₦19.6 billion in 2024, up by a staggering 133% from ₦8.39 billion in 2023. This was driven largely by a ₦28.9 billion realised FX loss, partially offset by a ₦9.35 billion gain.
A look at recent share price movements reveals Aradel’s share dropped from ₦598 to ₦530, representing an 11.4% YTD decline. Conoil, with a market capitalisation of ₦186 billion, declined by 10% YTD from ₦387.20 to ₦268.30. MRS also took a heavy hit, falling 34.9% from ₦217.80 to ₦141.80.
Despite these challenges, shareholders remain cautiously optimistic. President of the New Dimension Shareholders Association of Nigeria, Mr. Patrick Ajudua, said that dividend announcements from firms like Seplat have helped to stabilise interest in the sector.
He noted that while the oil and gas sector is currently under pressure from falling international oil prices, OPEC production limits, and persistent issues like oil theft and pipeline vandalism, a turnaround could be on the horizon.
“With stronger government action to secure infrastructure, optimise costs, and stabilise crude prices, we expect oil and gas stocks to rebound,” Ajudua said.
Analysts from Vetiva Dealings & Brokerage forecast that the next trading session will likely be shaped by dividend-related activity. “With several stocks nearing qualification dates, selective buying is expected. In the absence of fresh macroeconomic news, trading might remain sideways as investors lock in profits,” they noted.
The broader equities market remains buoyed by improved investor sentiment and selective buying in blue-chip stocks, many of which have hit record highs. The ASI has recorded a YTD gain of 8.7%, while the Consumer Goods Index leads the sectoral chart with a 37.4% gain. The banking index is up by 5.97%, and the ASeM index has seen a modest gain of 0.6%.
As trading continues, all eyes remain on market fundamentals, dividend announcements, and the Central Bank’s monetary stance, all of which will influence investor behaviour in the coming weeks.