Dividend Inflows, Earnings Optimism To Fuel Equities Market Gains This Week

Financial market analysts have projected sustained gains in the Nigerian equities market this week as dividend payouts boost liquidity and investors take early positions ahead of first-quarter (Q1) results.

The positive sentiment is expected to favour companies with strong fundamentals and earnings visibility, with banking, consumer goods, and industrial stocks tipped as likely beneficiaries.

Looking ahead, Cowry Assets Management Limited said, “the market is likely to remain broadly positive, supported by strong liquidity and continued investor interest. However, the pace of gains may begin to moderate as investors increasingly lock in profits, particularly in stocks that have recorded significant price appreciation.

“This suggests a shift from broad-based buying to a more selective approach, where attention is focused on fundamentally strong and undervalued stocks.”

The firm noted that while momentum indicators still point to continued upward movement, some are approaching overbought levels as an early signal that the market may be nearing a short-term peak, explaining that “this raises the likelihood of a consolidation phase or mild pullback in the near term. In addition, subtle signs such as easing trading volumes and less consistent breadth suggest that participation may be thinning beneath the surface.”

Afrinvest Limited also said, “This week, we expect this bullish streak to be sustained, supported by continued liquidity from dividend payments, and positioning ahead of Q1 earnings releases.”

Meanwhile, the equities market closed last week on a strong footing, sustaining its bullish run as gains in key large- and mid-cap stocks continued to lift overall market performance.

The benchmark NGX All-Share Index (ASI) advanced by 3.96 per cent week-on-week to close at 225,724.33 points, while the market capitalisation rose by N5.51 trillion to close the week at N145.335 trillion. Consequently, the year-to-date return strengthened to 45.05 per cent, reflecting sustained optimism and strong risk appetite in the equities space.

Market breadth closed positive, with 53 gainers to 46 decliners, indicating that buying interest was relatively widespread. UACN led the gainers’ table, rising by 42.00 per cent to close at N142.00 per share. Union Dicon Salt followed with a gain of 32.73 per cent to close at N21.90, while NASCON Allied Industries went up by 32.63 per cent to close at N206.90 per share.

On the other hand, Infinity Trust Mortgage Bank led the decliners’ table by 50.79 per cent, closing at N9.35 per share. Abbey Mortgage Bank followed with a loss of 33.33 per cent to close at N5.40, while Guinea Insurance declined by 15.20 per cent to close at N1.06 per share.

Overall, a total of 3.805 billion shares worth N213.955 billion were traded by investors on the floor of the Exchange last week, in contrast to 3.588 billion shares valued at N195.313 billion that exchanged hands the previous week in 254,553 deals.

The Financial Services Industry led the activity chart, with 2.739 billion shares valued at N106.269 billion traded in 135,101 deals, contributing 71.99 per cent to the total equity turnover volume and 49.67 per cent to the total equity turnover value.

The Services Industry followed with 212.324 million shares worth N4.024 billion in 17,042 deals, while the Consumer Goods Industry traded 180.076 million shares worth N13.269 billion in 32,457 deals.

Trading in the top equities, Access Holdings, United Bank for Africa (UBA), and First HoldCo accounted for 814.060 million shares worth N39.032 billion in 37,195 deals, contributing 21.40 per cent to the total equity turnover volume and 18.24 per cent to the total equity turnover value.