Investors gain N1.29trn as frontier-market upgrade lifts sentiment

Investors on the Nigerian Exchange Limited (NGX) recorded a N1.29 trillion increase in market capitalisation last week as renewed demand for selected banking and oil and gas stocks pushed the equities market higher.

The market capitalisation rose to N155.83 trillion, while the NGX All-Share Index (ASI) advanced by 0.81 per cent week-on-week to close at 241,298.47 points.

With the latest gain, the market’s year-to-date return climbed to 55.06 per cent.

The recovery came largely from renewed buying interest in selected large- and mid-capitalised companies, particularly in the banking and oil and gas sectors.

Market analysts said the positive sentiment was reinforced by the confirmation from FTSE Russell that Nigeria would be reclassified from an unclassified market to frontier market status effective September 21, 2026.

The development is expected to improve Nigeria’s standing among international investors and potentially attract fresh foreign portfolio interest following the country’s return to the global frontier-market classification.

Despite the rise in the benchmark index, trading breadth remained negative, indicating that the overall rally was driven by a relatively small group of stocks.

A total of 55 equities closed lower during the week, compared with 24 gainers, producing a breadth ratio of 0.44 times.

Trading activity also weakened significantly. The number of deals fell by 6.92 per cent, while traded volume and transaction value dropped by 59.84 per cent and 21.84 per cent respectively compared with the previous week.

In total, 2.51 billion shares worth N123.37 billion changed hands in 173,848 deals.

The oil and gas sector led the sectoral gainers, advancing 4.54 per cent, with Seplat Energy emerging as a major contributor after its share price rose by 10 per cent during the week.

Consumer goods stocks also performed strongly, with the sector gaining 2.93 per cent on renewed interest in Guinness Nigeria.

The banking sector rose by 2.85 per cent, supported by increased demand for selected tier-one banks. First HoldCo, Access Holdings and United Bank for Africa were among the notable gainers.

Given their substantial market weights, the performance of the major banking stocks provided significant support to the benchmark index.

However, the insurance sector declined by 1.27 per cent, with International Energy Insurance, Veritas Kapital Assurance and SUNU Assurances Nigeria among the stocks weighing on the sector.

Industrial goods also recorded a marginal decline of 0.15 per cent following profit-taking in Austin Laz and Cutix.

The contrasting sectoral performances showed that investors remained selective, favouring liquid companies and stocks perceived to have stronger fundamentals rather than driving a broad-based market rally.

Analysts said the frontier-market reclassification could provide an additional catalyst for the equities market, particularly if it translates into increased visibility and participation by international investors.