On Wednesday, oil prices fell to a three-week low on news that Libyan output was recovering from an oilfield technical issue. Despite this, the Nigerian equities market posted record gains in the month of May, growing N1.285 trillion or 14.4% by market capitalisation on sustained investor demand for Nigerian stocks.
Following improved foreign exchange management by the Central Bank of Nigeria (CBN), the Nigerian stock market posted the biggest gains in over three years last month on sustained investor confidence.
The stock market saw a huge gain in May with the Nigerian Stock Exchange All-Share Index (ASI) jump by 14.5%. This is despite losing 6.17% in 2016, and being in negative territory at the end of April 2017.
Trading data for May showed that market capitalisation improved from N8.913 trillion at the end of April to N10.198 trillion yesterday, the last trading day of the month. Also, the ASI rose from 25,758.51 to 29,498.31.
Between January and the third week of April 2017, the market had shed N343 billion before the unprecedented rally that started in the last week of April and was sustained throughout the month of May.
Consequently, the market soared by 14.5 per cent in May, compared with a marginal growth of 0.9 per cent in April, 0.7 per cent in March and declines of 2.7 per cent in February and 3.1 per cent in January.
The road to the rally was triggered by the introduction of the new forex window for investors and exporters (I&E) by the CBN. Apart from the new FX window, analysts had also said investors were also responding to more favourable economic conditions, all signalling that Nigeria was likely to exit its biting recession by the third quarter of this year.
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