Contrary to fears on the part of market players, equity trading activities on the Nigerian Stock Exchange closed on a positive note in November.

Statistics from the NSE showed that the All-Share Index closed the month at 26,494.44 basis points, representing an improvement by 0.24 per cent or 63.52 points compared to 26,430.92 points at the end of October.

Also, the market capitalisation of the listed equities rose marginally by 0.5 per cent or N44bn to close the month at N8.466tn, up from N8.422tn recorded at the end of the previous month.

The NSE-30 Index, which measures the performance of the top 30 stocks on the bourse also gained 1.2 per cent or 14.36 basis points to close the month at 1,258.55 points, up from 1,244.19 at the beginning of the month.

However, the banking index suffered a significant loss in the month under review, as it fell by 28.6 per cent or 121.77 basis points from 426.72 at the end of October to 304.95 points.

Analysts were of the opinion that the banking sub-sector suffered a huge loss as a result of profit taking activities of investors, who took advantage of the price increase in the sector in the last few months.

Meanwhile, analysts have predicted that the market might record marginal gain at the end trading this year.

They predicted this on the back of expected full year results of companies which would be posted early next year.

In their report for the week ended November 30, 2012, analysts from Meristem Nigeria Limited said that investors would take position ahead of dividend declaration by quoted companies.

They said, “The market closed November with a month-to-date gain of 0.24 per cent though it closed October at 1.61 per cent gain. Bearish domination on stock trading in the quarter contributed to the marginal quarter-to-date return of 1.86 per cent as against the previous quarter’s 20.43 per cent.

“As market opens for the last trading month of the year, position taking ahead of the dividend declaration as well as profit taking will dominate investment decision. Thus we expect marginal return supporting our conservative outlook for the quarter.”

The Managing Director/Chief Executive Officer, Goldbanc Management Associates Limited, Mr. Olu Sanya, noted that the significant increase recorded in the equities market in the last few months was as a result of low prices of shares, which had been selling below their value.

He, however, stated that activities in the market were likely to witness increased growth if the Federal Government stepped up activities aimed at restructuring the economy and boosting the real sector.

Source: Punch (written by Udeme Ekwere)