Nigerian stocks end 2024 yielding 38%

Nigerian stocks closed the year on Tuesday, delivering a 37.7 per cent gain, extending a run of positive returns that began in 2020.

That is slightly higher than the country’s current inflation rate, which, ascending to 34.6 per cent in November, is now a breath away from its highest level in three decades.

At the close of trade in Lagos, the market value of the 152 listed equities stood at N62.8 trillion, up from N40.9 trillion a year ago.

The main equity index reached an all-time high earlier in the year, exceeding 105,000 basis points. At the close of trade on Tuesday, it stood at 102,926 basis points.

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Boosting market capitalisation, two major listings were recorded during the year: Transcorp Power, an electricity provider spun off from the conglomerate Transnational Corporation Plc, and Aradel Holdings, part of the consortium procuring Shell Nigeria’s onshore assets recently.

Respectively, the two added N1.8 trillion and N3.1 trillion to the bourse’s market value at listing.

Foreign participation in Nigerian equity, which saw a steep decline in recent years on account of a liquidity squeeze in the currency market, climbed to 16 per cent (N785.3 billion) of total transaction value at the end of November, compared to 11.2 per cent (N362.8 billion) a year prior.

Local participation drove activity, contributing 84 per cent or N4.1 trillion as of the end of November, according to the NGX Foreign Portfolio Investment Report.

That compares to the 88 per cent or N2.9 trillion reported in the same period of 2023.

“Over the past decade, the consistent outperformance of our blue-chip companies has been a critical driver of market returns,” said Temi Popoola, CEO of Nigerian Exchange Plc.

“High inflation has also shaped investment strategies, with equities becoming a preferred hedge. As a result, share prices have often adjusted in line with inflationary trends, preserving investor value,” he added.

Performance by sector

NGX Oil & Gas
NGX Oil & Gas, the index that tracks the most capitalised and liquid stocks in the energy sector, finished a second consecutive year as the best-performing sector. The index returned 158.9 per cent.

NGX Insurance
The NGX Insurance Index returned 112.7 per cent.

NGX Consumer Goods
The NGX Consumer Goods Index, the index tracking the most capitalised and liquid stocks in the consumer goods industry, yielded 54.4 per cent.

NGX Industrial Goods
The NGX Industrial Index appreciated by 31.5 per cent.

NGX Banking
The NGX Banking Index took the rear of the five sector indexes tracked by the bourse. It yielded 21.3 per cent.

NGX 30
NGX 30, which tracks the top 30 companies on the exchange in terms of market value and liquidity, returned 36.6 per cent.