Business
Nigeria stock market surge will continue in 2013
Traders on the floor of the Nigerian Stock exchange. PHOTO/File
(Reuters) – Nigerian stock market bulls say last year’s surge in share prices will continue throughout 2013, citing falling bond yields and strong earnings as powerful lures for investors to return to the market.
Nigeria ended 2012 as the second best performing stock market in Africa behind Uganda, after sub-Saharan Africa’s second biggest index rose 35 percent.
So far this year, it has risen 18.2 percent, vastly outperforming emerging market peers, which are down on average 1.3 percent this year.
In the first six weeks of trading, the index climbed to a 4-year high, breaking through the 33,000 resistance level on bargain hunting for banking shares seen as cheap after they reported strong third quarter earnings.
Improved liquidity from a market-making program on equities introduced last September has also helped build confidence.
Analysts expect the momentum to continue this year.
“We expect the Nigerian index to reach 38,000 mark if earnings growth is sustained,” Funmi Akinluyi, Silk Invest’s sub-Saharan Africa investment director, said.
