Nigeria’s stock market has ended the week at another record high, with the value of listed equities rising to ₦162.16 trillion on Friday.
The NGX All-Share Index also climbed to 249,804.56 points, up 1.42 per cent from Thursday’s close of 246,315.38 points.
The latest gain means the market has continued its run of record highs after hitting ₦159.89 trillion on Thursday.
Trading was active during Friday’s session, with investors exchanging 525.99 million shares in 44,239 deals. The market gained about ₦2.27 trillion in value during the session.
So what is behind the rally?
Buying has remained strong
The simplest reason for a rising stock market is buying.
When demand for shares increases, prices can rise. When this happens across a number of companies, the overall market index also moves higher.
That is what has been happening on the NGX.
Friday ended with 36 stocks recording gains against 22 decliners. C&I Leasing, FTG Insurance and MTN Nigeria were among the biggest gainers.
Transcorp Power, however, fell almost 10 per cent, while Cadbury, Omatek Ventures and Sovereign Trust Insurance also recorded losses.
So the record does not mean every company on the exchange is rising.
It reflects the combined movement of the shares that make up the market’s main index.
The Dangote IPO is part of the story
The rally has come as investors are also paying close attention to the ₦2.15 trillion Dangote Petroleum Refinery IPO.
The offer opened on September 14, with 4.1 billion shares priced at ₦525 each. The minimum subscription is 10 shares, or ₦5,250.
Since the offer opened, the NGX has recorded strong activity. THISDAY reported that the market gained about ₦2.3 trillion over the first four trading sessions of the week, with investor interest around the Dangote offer contributing to the positive mood.
But the IPO is not the only thing moving the market.
The shares being offered by Dangote Refinery have not yet started normal trading on the NGX. Investors are still applying for the shares, meaning the current market rally should not be treated as the Dangote shares themselves driving the index.
There has also been strong activity in existing listed companies.
Banks remain heavily traded
Financial stocks have continued to account for a large part of trading activity.
On Thursday, Fidelity Bank was the most traded stock by volume, while Zenith Bank and Access Holdings were also among the heavily traded counters. Nairametrics reported that financial services accounted for a large share of the day’s activity.
Industrial stocks have also performed strongly.
On Thursday, the NGX Industrial Index gained 2.89 per cent, while the Insurance and Banking indices rose 1.88 per cent and 1.18 per cent respectively.
That wider movement is important because it shows the rally is not coming from just one or two companies.
What does ₦162tn actually mean?
The ₦162.16 trillion figure is the total market value of the shares listed on the exchange.
It does not mean NGX has ₦162 trillion sitting somewhere as cash.
For example, if a company has one billion shares and each share is worth ₦100 on the market, the company would have a market capitalisation of ₦100 billion.
The same calculation is done across listed companies to arrive at the overall market capitalisation.
So when the figure rises, it generally means the market value of listed companies has increased.
It also does not mean that every Nigerian who owns shares has made money.
An investor holding a stock that has fallen may not benefit from the wider rally. Someone who does not own shares at all does not directly receive a return simply because the NGX reaches a new record.
Why the record matters
The latest rise comes at a time when more Nigerians are being exposed to the stock market through investment apps, banks and public share offers.
The Dangote IPO has brought this into focus, with large numbers of retail investors trying to participate. Some investment platforms even struggled with the sudden increase in traffic when the offer opened.
At the same time, the NGX is recording stronger activity in existing listed stocks.
The market has therefore entered the final months of the year at a much higher level than where it started.
What happens after the Dangote IPO closes will provide another indication of how much of the current activity is tied to the offer and how much reflects broader demand for Nigerian equities.
For now, the numbers are clear: the NGX has set another record, and investors have continued buying shares across several parts of the market.
