The mood on the Nigerian Exchange turned cautiously optimistic last week as investors began eyeing interim dividends.
Despite swings between gains and losses, the market ended the week on a positive note, adding ₦377 billion.
Activity picked up in banking, insurance, and consumer goods stocks, hinting at early bets on strong second-quarter results.
Focus Shifts To Interim Dividends
As the second-quarter earnings season approaches, investors have begun to shift their focus to companies likely to announce interim dividends.
Consequently, they increased their buying activity in the consumer goods, insurance, and banking sectors.
In contrast, profit-takers slowed momentum in Oil & Gas and Industrial stocks, leading to muted performance in those areas.
Analysts Expected Market Lift
Earlier in the week, analysts had predicted a modest market uptick.
They based their outlook on the excess liquidity circulating in the financial system, which they believed would flow into the equities market.
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Additionally, they expected investors to favour fundamentally strong companies with a track record of interim dividend payments.
ASI And Market Cap Rise
As the week progressed, the Nigerian Exchange (NGX) All-Share Index climbed from 119,995.76 to 120,990.27 points.
Likewise, the equities market capitalisation rose from ₦75.962 trillion to ₦76.339 trillion.
Analysts Highlight Sector Rotation
Commenting on the market’s close, analysts at Lagos-based Vetiva observed, “The market’s recovery in the last session shows that investors continue to embrace a broader risk-on sentiment.
As portfolio rebalancing gathers pace ahead of the second half, we anticipate further rotation into fundamentally sound stocks, especially in the banking and consumer sectors.”
Looking ahead, investors remain focused on upcoming earnings reports, seeking companies that will reward their early positioning with solid interim dividends.