Sustained NGX Bullish Run Signals Renewed Market Confidence
The Nigerian stock market continued its upward trajectory on Thursday as the Nigerian Exchange Limited (NGX) extended its NGX bullish run, recording a fresh N97bn gain for investors.
The latest surge reinforces analysts’ projections of a potential year-end rebound despite recent weeks of mixed trading sentiment.
At the close of trading, the All-Share Index advanced by 0.10 per cent to 145,476.15 points, while market capitalisation climbed to N92.73tn.
The mild but consistent uptrend aligns with investor expectations that December could witness renewed bargain hunting, particularly following November’s notable price corrections.
Analysts at AIICO Capital, in their weekly market report, attributed the rally to investor appetite for undervalued stocks, cautioning, however, that uncertainties around the proposed implementation of the Capital Gains Tax (CGT) regime in 2026 may continue to influence short-term decisions.
“We anticipate a market rebound as investors seek opportunities following November’s price declines and position for a potential year-end rally. However, concerns over the planned implementation of the new CGT in 2026 may continue to weigh on sentiment,” the analysts said.
Key Drivers Behind the NGX Bullish Run
Thursday’s uptrend in the NGX bullish run was largely driven by renewed demand for high-cap and fundamentally strong equities.
Cement giant WAPCO appreciated by 3.45 per cent, Nigerian Breweries gained 2.79 per cent, while Ecobank Transnational Incorporated (ETI) posted an impressive 8.53 per cent jump.
Guaranty Trust Holding Company (GTCO) also recorded a modest 1.15 per cent uptick, contributing significantly to overall market momentum.
Despite the positive close, market breadth remained negative as 28 equities declined compared to 23 that advanced.
Among the top laggards were Ellah Lakes and Eunisell, both shedding 10 per cent each.
On the gainers’ chart, UAC Nigeria led with a full 10 per cent appreciation to N88.00 per share, followed closely by Morison Industries, which rose 9.94 per cent to N3.54, and ETI, closing at N36.90.
Trading activity presented a mixed picture. Share volume fell by 14.15 per cent to 1.93 billion units, while transaction value dipped by 8.47 per cent to N19.19bn.
However, the number of executed deals rose by 8.63 per cent to 23,369, signalling sustained investor engagement.
Fidelity Bank topped the volume chart with 31 million units, while GTCO dominated value transactions, recording N2.5bn in trades.
Sectoral Performance Reinforces the NGX Bullish Run
The sectoral breakdown revealed widespread optimism, with five major indices closing in the green and supporting the ongoing NGX bullish run.
The Insurance Index led with a strong 1.56 per cent growth, spurred by impressive gains in AXA Mansard (+7.75 per cent) and WAPIC (+8.47 per cent).
The Banking Index rose by 0.91 per cent, reflecting sustained interest in lenders as investors positioned ahead of expected improvements in bank earnings.
The Industrial Goods Index increased by 0.48 per cent on the back of WAPCO’s notable performance.
The Consumer Goods Index posted a modest 0.28 per cent gain, buoyed by retail-focused stocks such as Nigerian Breweries. The Oil & Gas Index also ticked up by 0.08 per cent, driven by buy interest in Oando.
The Commodity Index, however, closed flat as commodity-linked securities saw muted activity.
Analysts Predict a Mixed December Despite Early Strength
In its monthly market outlook, Meristem Securities noted that trading patterns in December are historically inconsistent, influenced by fiscal planning, festive spending, and year-end regulatory obligations.
“Looking into December, market activity is likely to remain mixed. Some investors may rebalance portfolios ahead of year-end obligations, while others continue to react to the capital gains tax, which is expected to take effect in January 2026,” the firm stated.
Meristem added that opportunities remain for early-month bargain hunters, particularly as several fundamentally strong stocks are now trading at attractive entry points.
The firm further highlighted that the Monetary Policy Committee’s decision to maintain interest rates while adjusting the asymmetric corridor could sustain investor appetite for banking stocks, given the improved liquidity that may enhance banks’ lending capacity and earnings.
The firm, however, cautioned that seasonal liquidity pressures may reshape market performance toward month-end.
“December typically comes with its own dynamics. With the festive season underway, corporates and individuals tend to draw down cash for year-end incentives, salary adjustments, bonuses and holiday spending.
This often leads to reduced liquidity in the market and can trigger portfolio adjustments,” Meristem explained.
Despite these factors, analysts expect the NGX bullish run to show resilience in the short term, buoyed by bargain hunting, dividend expectations and cautious optimism from domestic institutional investors.
Market Outlook: Year-End Rally vs Liquidity Pressures
The broader market outlook indicates a tug-of-war between bullish sentiment and macroeconomic pressures.
While the expectation of strong FY2025 corporate earnings could drive demand for value stocks, policy concerns around CGT implementation and tightening global financial conditions remain potential headwinds.
Foreign investor inflows are projected to remain conservative due to global risk aversion, but domestic investors—particularly pension fund administrators and high-net-worth individuals—are expected to sustain participation across strategic counters.
If liquidity remains stable in the early part of December, the NGX bullish run could strengthen further, setting the stage for a more robust performance ahead of the release of full-year financial statements in Q1 2026.
