Nigerian equities recorded another major rally yesterday as positive sentiments on the new foreign exchange (forex) framework of the Central Bank of Nigeria (CBN) left investors with net capital gain of N206 billion.
The naira also firmed up, gaining N12 to the dollar.
With N294 billion capital gains recorded on Wednesday after the announcement of the new forex guidelines, the stock market has recorded a net gain of N500 billion in the past two trading sessions.
The benchmark index for the Nigerian stock market, the All Share Index (ASI), crossed another high to close at 28,489.89 points yesterday as against its opening index of 27,891.96 points, representing average gain of 2.14 per cent. Aggregate market value of all quoted equities on the Nigerian Stock Exchange (NSE) rose from N9.579 trillion to close at N9.785 trillion.
With this, the stock market is on the verge of crossing to net positive return as average year-to-date return closed at -0.53 per cent. With 32 advancers to 15 decliners, the overall market situation was boosted by gains across the sectors, including several highly capitalised stocks.
Turnover also rose above average to 618.24 million shares valued at N5.41 billion in 6,757 deals.
In the new flexible foreign exchange system, the apex bank will merge all existing segments of foreign exchange market into a single “window”, which pricing will be determined by market forces with limited intervention from the apex bank. In essence, Naira will flow according to market forces with effect from Monday.
The naira gained N12 to close at N355 to the dollar in the parallel market as a result of the new policy.
The naira had closed at N367 on Wednesday, but recovered after traders saw the new policy as positive for investment.
President, Association of Bureau De Change Operators of Nigeria (ABCON), Aminu Gwadabe, attributed the gain appreciation to drop in demand for the dollar and increased supply of the greenback from speculators.
