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Against the backdrop of the delayed approval of banks’ audited results for the full financial year 2023 by the Central Bank of Nigeria (CBN), investors in the stock market are closely watching the outcome as the apex bank’s Monetary Policy Committee (MPC) meets today and tomorrow.
The results of the MPC meeting, to be announced tomorrow, are expected to have a significant influence on investment decisions, particularly in the financial sector.
Analysts have highlighted that the delayed approval of banks’ results is already impacting investors’ sentiments and confidence in the sector, extending to the overall market.
It appears that the MPC has prioritized attracting foreign inflows to address FX challenges, potentially sacrificing short-term economic concerns. This prioritization has already yielded results, with the CBN clearing all FX backlogs last week and the naira appreciating, alongside improvements in the nation’s external reserves after months of decline.
Meanwhile, an analysis of the market performance indicated a 0.42% decline Week on Week (W/W) in the Nigerian stock market.
The Nigerian Exchange Limited (NGX) All Share Index (ASI), a key performance indicator, dropped to 104,647.37 points from 105,085.25 the previous week. Similarly, the NGX market capitalization, reflecting the total value of investments on the Exchange, reduced to N59.168 trillion from N59.416 trillion.
During the week under review, losses in MTN Nigeria, down by 12.25% W/W, Dangote Sugar by 3.67% W/W, and Transcorp by 0.32% W/W, outweighed gains in First Bank Nigeria Holdings (FBNH), up 4.46% W/W, UBA by 11.11% W/W, and Access Corporation by 4.35% W/W, contributing to the market’s negative performance.
Consequently, the Year-to-Date (YtD) return on the index slipped to 39.95%.
Analysts at InvestData Consulting Limited commented on the market outlook, anticipating mixed sentiment and profit-taking as investors await the release of more corporate earnings with dividend possibilities ahead of the next MPC meeting. They advised investors to take advantage of price corrections amid volatility and pullbacks, while monitoring global and domestic trends and events.
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