NGX Fixed Income Market Cap Hits N21.43trn amidst Uncertainty

Kayode Tokede

Despite uncertainty in the global economy coupled with the weak macroeconomic challenges in Nigeria, the market capitalisation of the Nigerian Exchange Limited (NGX) Fixed Income rose to N21.43 trillion at the close of transactions in March 2022.

Analysts had expressed worry that the uncertainty in the global economy would have a negative impact on the capital market. 

However, data obtained from the NGX’s Products/Asset Class performance showed that fixed income market capitalization sector which closed the month of February 2022 at N21.099 trillion, increased by N328.08 billion or 1.55 per cent to close at N21.427 trillion.

Also, Exchange Traded Funds (ETFs) market capitalization was up from N21.106 trillion in February to N21.434 trillion, representing an increase of N327.87 billion. Premium Board capitalization appreciated by 0.73 per cent and closed at N11.703 trillion from N11.619 trillion in February representing an increase of N84.433 billion while ICT grew from N4.759 trillion in February by N1.374 billion to N4.761 trillion.

Similarly, the Oil and Gas sector index was up 3.79 per cent, the best performing index compared to other sectors while the NGX Lotus Islamic Index rose by 1.46 per cent; NGX Premium Index up by 1.73 per cent and NGX Meri Growth Index up by 1.44 per cent. 

Speaking on the market performance, Chief Operating Officer of InvestData Consulting Limited, Ambrose Omordion, said the stock market sustained positive sentiment and uptrend due to the influx of corporate actions and 2021 audited financials, as players reacted to the released numbers and dividend declared for year-end 2021 earnings.

Omordion said that was expected to support an uptrend during the earnings season, amid the oscillating oil prices, just as the market continues to interpret economic data in relationship with crude oil price and other factors, in the midst of profit-taking and portfolio rebalancing.

Commenting on the market performance in March, the Managing Director, ARM Securities Limited, Mr. Rotimi Olubi said the stock market had sentiment trading majorly driven by profit-taking activities from investors that had positioned themselves ahead of earnings releases and dividend declaration.

He projected that: “In April, a couple of factors would shape performance. Inflation is expected to maintain an upward trajectory on the back of higher energy prices. The MPC has held policy parameters in the face of global monetary policy normalisation thereby widening the negative real return. This should see investors shy away from the Fixed Income market and position in the equities market.”

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