The Nigerian Autonomous Foreign Exchange Market (NAFEM) witnessed the naira’s depreciation by 22.1%, reaching N996.75/$. The total turnover in the market fell by 7.4% week-to-date to $545.89 million, with trades occurring in the N700 to N1,100/$ range.
In the forwards market, exchange rates dropped over the past month: three-month (-10% to N890.19/$), six-month (-10.3% to N918/$), and one-year (-9.5% to N969.18/$).
Analysts at Cordros Capital anticipate slight improvement in FX liquidity conditions, expecting a potential easing of local currency pressures. They emphasize the importance of sustained actions by policymakers and the watchful eyes of foreign investors on FX developments.
On the equities market, a turnover of 2.5 billion shares valued at N45.3 billion was recorded in 32,815 deals. This marked an increase from the previous month, with the financial services industry leading in volume and value.
Top equities, including Japaul Gold and Venture Plc, FBN Holdings, and United Bank for Africa Plc, accounted for a significant portion of the total equity turnover volume.
Gains were observed in BUA Cement, FBNH, and Seplat, contributing to a 0.9% increase in the all-share index (ASI) and market capitalization, closing the week at 70,849.38 and N38.925 trillion, respectively. Month-to-Date and Year-to-Date returns stood at +2.3% and +38.2%, respectively.
Sectoral performance varied, with the oil and gas, industrial goods, and banking indices recording gains, while the insurance index depreciated.
Investors are advised to consider fundamentally justified stocks, given the market’s recent rally, and experts anticipate a potential mix of profit-taking and bargain hunting in the coming weeks.
