Nigerian Stock Market Rebounds Following CBN Governor’s Suspension

The Nigerian stock market rebounded on Tuesday, following the suspension of Central Bank Governor Godwin Emefiele by President Bola Tinubu.

Emefiele was suspended on Friday, with Tinubu citing an ongoing investigation into his office and planned reforms in the financial sector.

The market’s positive reaction appears to be due to expectations that Emefiele’s suspension will pave the way for a more transparent and accountable monetary policy, as well as a possible devaluation of the naira to ease pressure on the exchange rate and inflation.

The Nigerian stock market has been under pressure in recent months, due to a number of factors, including the ongoing economic slowdown, the war in Ukraine, and rising inflation.

Emefiele’s suspension is seen as a sign that the government is serious about addressing the challenges facing the economy, and this has boosted investor confidence.

It remains to be seen whether the suspension of Emefiele will lead to the desired changes in monetary policy and the exchange rate. However, the market’s positive reaction is a sign that investors are hopeful that the government is taking the necessary steps to address the challenges facing the economy.

How the market reacted

The benchmark All-share index soared by 4% or 2,232.58 points to close at 58,163.55 points, while the market capitalization increased by N1.22 trillion or 4% to settle at N31.670 trillion.

• The suspension of the CBN Governor also triggered a rally in the banking sector, as investors anticipated a positive impact on the liquidity and profitability of the banks.
• The NSE Banking Index rose by 6.7% to lead the sectoral performance, followed by the NSE Insurance Index which gained 5.4%.
• The NSE Consumer Goods Index and the NSE Oil and Gas Index also advanced by 4.3% and 3.9%, respectively.

Investors also poured into the market as the value of deals transacted rose 55% compared to the last trading day while the volume of deals also rose by about 106%. Market Turnover was up by about 216%.

Stocks Gain big

The market breadth was positive, as 62 stocks appreciated among which the top 10 gained above 9% on the day.

• The top gainers were Access Corp, GT CO, NASCON, Zenith Bank, and Lasco all of which gained 10% respectively.
• The top losers were Elah Lakes (-10%), John Hold (-10%), Caveraon (-4.6%), Veritas (-4.35%), and Honeywell Flour (-4.29%).
• The All Share Index is 13.49% up year to date as investors continue to react positively to development in the economy.

FUGAZ on a roll: The trio of Access Bank, GTCO, and Zenith Bank are currently up 68%, 33.9%, and 28.3% year to date. UBA and FBNH which make up the FUGAZ are also up 33% and 43% year to date respectively.

Read More Articles

Meet Folashodun Shonubi: The acting CBN Governor

I didn’t know he is so intelligent, LP lawmaker-elect says after meeting with President Tinubu