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Stock market gains N2.73tn in May amid bearish sentiment


The nation’s stock market gained N2.73bn last month amid weak investor sentiment as the listing of MTN Nigeria Communications Plc on the Nigerian Stock Exchange buoyed market performance.

The market recorded positive performance for six straight days after the MTN listing, as the market capitalisation of equities listed on NSE surged to N13.864tn on May 23.

But profit-taking activity in subsequent sessions halted the six-day rally.

The market capitalisation closed at N13.684tn on May 31, up from N10.958tn on April 30, while the All Share Index rose to 31,069.37 basis points month-on -month from 29,159.74 bps.

The NSE admitted MTN Nigeria on its Premium Board at N90 per share on May 16 after the company’s listing by way of introduction.

A listing by introduction provides existing shareholders with the opportunity to sell their shares to the public.

MTN Nigeria listed 20.4 billion shares at N90 per share, which translates to a market capitalisation of N1.8tn, making it the second largest company listed on the NSE after Dangote Cement Plc, as it accounted for 17.3 per cent of total market capitalisation on the day of listing.

The market value of listed equities rose to N12.52tn at the close of trading on May 16 from N10.63tn the previous day.

After its listing, the share price of the telco surged by the daily limit of 10 per cent for five straight days as demand for its shares far outpaced supply.

The NSE ASE and market capitalisation appreciated by 0.61 per cent to close at31,069.37 bps and N13.685tn, respectively last week.

Similarly, all other indices finished higher with the exception of the NSE MERI Value Index, which depreciated by 0.14 per cent while the NSE ASeM Index closed flat.

Thirty-five equities appreciated in price during last week, higher than 30 in the previous week; twenty-four equities depreciated in price, lower than 40 equities of the previous week, while 109 equities remained unchanged, higher than 98 equities recorded in the preceding week.

A total turnover of1.082 billion shares worth N18.111bn in 16,400 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 1.698 billion shares valued at N57.895bn that exchanged hands in 24,328 deals the previous week.

Analysts at Afrinvest Securities Limited said despite last week’s performance and improved investor sentiment, “we anticipate a bearish performance next (this) week in the absence of any major market catalyst.”

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