Stock market closes MPC week in green

Nigeria’s equities market closed the MPC week in green, rising by 0.41 percent or N196billion in the trading week ended Friday, February 21.

Consumer goods and insurance stocks led the market into the positive region despite major dips by banking and oil & gas stocks.

In the review trading week, the National Bureau of Statistics (NBS) released Nigeria’s inflation report which showed headline inflation rate dropped to 24.48 percent in January after rebasing as against 34.80 percent in December 2024.

Also, after its two-day monetary policy meeting, the Monetary Policy Committee (MPC) in the review week retained the Monetary Policy Rate (MPR) at 27.50 percent and retained the asymmetric corridor around the MPR at +500 basis points (bps)/-100bps.

The MPC also retained the Cash Reserve Ratio (CRR) for deposit money banks at 50 percent; retained the CRR for merchant banks at 16 percent; and retained the liquidity ratio at 30 percent.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and equities market capitalisation increased from preceding week’s lows of 108,053.95 points and N67.418 trillion respectively to 108,497.4 points and N67.614 trillion.

Read also: Stock market dips by 0.04% as MPC retains benchmark rates

This record positive close came despite investors cautious positions in some stocks that affected major price rebound on Custom Street.

The week’s positive close pushed stock market’s year-to-date (YtD) return higher at +5.41 percent. This month, the market has risen by 3.83 percent.

Bismarck Rewane-led analysts at Financial Derivatives Company Limited (FDC) had ahead of MPC decisions and Nigeria’s inflation reports said in their recent presentation at Lagos Business School (LBS) breakfast session that in this first quarter (Q1) they expect cautious optimism for price rebound in specific stocks.

While expecting more companies to raise capital to shove previously eroded shareholders’ value, FDC analysts noted that this will lead to an increase in the supply of shares and a possible decline in prices.

“Stock prices will fall in February to reflect the new shares of bank recapitalisation,” FDC analysts added.

“Looking ahead, all eyes will be on how investors digest the CBN’s decision to keep interest rates unchanged,” Vetiva research analysts said on Thursday February 20. However, they expected cautious optimism to guide equities trading sessions as investors weigh near-term opportunities against broader macroeconomic uncertainties.

“Market sentiment is expected to remain mixed, supported by corporate earnings releases and portfolio rebalancing activities,” said analysts at SAMTL Research in their recent economic and financial market review.