Toba Owojaiye reporting
Abuja, Nigeria
In just eight months under President Bola Ahmed Tinubu’s administration, Nigeria’s stock market has emerged as a global leader, surpassing all expectations despite challenges like inflation and an unstable Naira exchange rate.
The economic boom is evident at the Nigerian Exchange, where stockholders are experiencing unprecedented capital gains and poised for remarkable dividends.
Truth Live News gathered that Mr Bayo Onanuga, Special Adviser, Information and Strategy to President Bola Ahmed Tinubu said that the positive trend began on May 30, 2023, coinciding with Tinubu’s inauguration, sparked by the President’s bold move to end the fraudulent petrol subsidy regime.
Despite the ongoing work to harmonize the exchange rate, the market has seen a bullish run. The All Share Index, reflecting general market movement, climbed from 55,738.35 in May to a record-breaking 94,538.12 by January 19, 2024, marking over 69 percent growth.
Market capitalization surged from N30.3 trillion in May 2023 to N51.7 trillion in January 2024, translating to investors gaining over N20 trillion since Tinubu assumed office. This remarkable performance has positioned the Nigerian Stock Market as the best globally, outperforming the MSCI Emerging Markets Europe, Middle East, and Africa Index.
Mr Bayo Onanuga asserted that Investors are responding by pouring more funds into the market, with 844.4 million units of stocks valued at N15 billion traded in 15,255 deals on a recent Friday alone. This market upswing is fueled by record profits announced by Nigerian banks and manufacturers like Dangote Cement, Bua Cement, and Lafarge Africa.
Banks, starting with their second-quarter reports, reported substantial gains from forex dealings, with Zenith and UBA showing significant increases in earnings per share.
This positive trend continued in Q3, propelling stock prices to new heights. Dangote Cement, Bua Cement, and others also experienced substantial growth, contributing to the overall market boom.
He clarified that investors are strategically positioning themselves in fundamentally driven stocks in anticipation of the upcoming earnings season.
The administration’s promises of prosperity are materializing for many investors, even as the government addresses challenges such as low forex inflow and rising costs of pharmaceutical products.
Measures are being considered to assist local drug manufacturers and secure World Bank funding support, while the country awaits Saudi Arabia’s pledged investment.
Mr Bayo Onanuga however stated that, despite the prosperity being felt in the stock market, the administration recognizes the need for widespread economic impact.
Efforts to address forex inflow challenges and boost the national currency are underway, including discussions for World Bank funding and anticipated investments from Saudi Arabia.
As the government tackles these issues, the promised prosperity may soon extend to a broader segment of Nigeria’s population.