Rising Demand for Blue-Chip Stocks Lifts NGX by N308 Billion

Nigeria’s equities market recorded a strong performance this week, as renewed demand for blue-chip stocks pushed the Nigerian Exchange (NGX) upward by N308 billion in market capitalization. The rebound, driven by impressive earnings reports and investors’ renewed confidence in the economy, saw key stocks in the banking, energy, and industrial sectors leading the rally.

At the close of trading on Thursday, the NGX All-Share Index (ASI) rose by 0.54% to settle at 101,846.29 points, up from 101,302.45 points recorded the previous day. The market capitalization increased from N57.21 trillion to N57.52 trillion, adding N308 billion in value. The rally marks a significant recovery following a brief lull earlier in the week, as investors moved to take advantage of attractive valuations in some high-performing stocks.

Market analysts attributed the positive momentum to a combination of factors, including improving investor sentiment, stronger corporate earnings, and renewed interest from foreign portfolio investors. They also cited recent policy actions by the Central Bank of Nigeria (CBN), which have stabilized the naira and moderated inflation expectations, as boosting investor confidence in the local equities market.

Blue-chip companies such as Dangote Cement, MTN Nigeria, Seplat Energy, Zenith Bank, and Access Holdings were among the major contributors to the market’s rise. Dangote Cement led the gainers with a 3.2% price appreciation, closing at N650 per share, while Seplat Energy and MTN Nigeria recorded respective gains of 2.5% and 1.8%. Banking stocks also performed strongly, with Zenith Bank and Access Holdings both gaining over 2%, reflecting investor optimism toward the sector’s profitability outlook.

Total trading volume stood at 418.36 million shares valued at N8.52 billion, exchanged in 7,268 deals. The most active stocks were UBA, Fidelity Bank, Transcorp, Access Holdings, and GTCO, accounting for a significant portion of the day’s total turnover. Market breadth also closed positive, with 37 gainers against 22 losers, reflecting strong buying pressure across most sectors.

Sectoral performance showed widespread gains across the board. The banking index rose by 1.16%, buoyed by strong demand for tier-one bank shares. The oil and gas index advanced by 0.88%, while the industrial goods index gained 0.74% on the back of improved sentiment in cement stocks. The consumer goods and insurance indices also appreciated by 0.52% and 0.43%, respectively, supported by renewed investor appetite for FMCG and insurance equities.

Market analysts believe that the bullish trend could extend into next week, barring any adverse macroeconomic shocks. They predict that continued improvements in foreign exchange liquidity and policy consistency will sustain the current momentum. “Investors are beginning to take a longer-term view of the Nigerian market,” said an equity analyst at Vetiva Capital Management. “The combination of earnings growth, dividend expectations, and policy clarity has created a more attractive environment for equities.”

Another factor contributing to the rally is the gradual return of offshore investors, who had previously stayed on the sidelines due to currency volatility. The recent improvement in foreign exchange management and increased transparency from the CBN have helped restore confidence. Analysts also note that the Nigerian government’s ongoing fiscal reforms, including debt restructuring and power sector investments, are positively influencing investor sentiment.

Despite the upbeat outlook, some analysts have cautioned that volatility could persist in the short term due to external pressures such as global interest rate trends and oil price fluctuations. “The Nigerian market remains sensitive to developments in the global economy,” said a Lagos-based investment strategist. “However, as long as domestic fundamentals continue to improve, the long-term trajectory remains positive.”

Investors have also expressed optimism that the upcoming release of third-quarter financial results from major companies will further drive market activity. Many expect earnings in the banking and energy sectors to remain strong due to rising interest margins and stable oil prices. The anticipation of year-end dividends has also fueled speculative trading among retail investors.

Meanwhile, the continued rise in market capitalization reflects the resilience of Nigerian equities amid a challenging macroeconomic backdrop. With inflation gradually moderating and GDP growth holding steady, the NGX appears poised for a more stable period of recovery and expansion.

As the trading week concludes, market participants will be closely watching how global and domestic economic indicators evolve in the coming days. Analysts say that if policy stability is maintained and corporate earnings remain strong, the NGX could close the month on a high note, potentially breaching new resistance levels before the end of October.

Overall, the surge in blue-chip demand has not only lifted investor confidence but also reaffirmed the resilience of Nigeria’s capital market. With renewed optimism, improving macroeconomic indicators, and increasing foreign participation, the Nigerian Exchange looks set to maintain its upward momentum in the coming weeks.