The Nigerian Exchange (NGX) has projected that the current positive vibration in the equity market might last longer. The projection is based on the current positive momentum and monetary policy committee outcome.
In a recent market update, the Nigerian Exchange stated thus:
“The long bullish run on the NGX is likely to continue, with the index action set to breakout the all-time high of 109,850.83 level and the 200-day moving average again on a strong buying sentiment and momentum that had supported many stocks to hit new 52-week highs in the face of shifting economic fundamentals and better than expected corporate earnings of listed companies.
The V shape chart pattern of the index action indicates inflows of funds in the equity space that had reflected on the buying interest across the low, mid and highly priced stocks to sustain this recovery and uptrend, which has been supported by improving volume, as the market currently trade relatively above its daily average on expanding positive market internals.
Profit taking or pullbacks at this stage of the markup phase of NGX creates opportunity for new entrance and at the same time add more power for the index to trend higher.
Stocks trading and investing are back in business after one month and some weeks setback on profit booking in March and first half of April after mega companies and sectors had announced their audited financials and corporate actions, coupled with the wave of tariffs war emanating from US trade policy that triggered global stock markets selloffs and fear of economic recession that weighed on market players.
The first quarter 2025 financials that started hitting the market at the mid of April changed the seemingly worst investor sentiment and volatility, with impressive numbers from Nigerian Breweries and others triggered position taking in the consumer goods sector and others.
As more corporate scorecards beat expectations ahead of their corporate actions of dividend qualification date and payment.
These fuelled the positive momentum, as players took advantage of earlier pullbacks and stronger Q1 earnings reports to reposition their portfolios in the midst of bargain hunting and sector rotation.
Even as the month of May has brought a wave of uptrend as a way of repeating history of being active on the NGX, after recording 18 times of positive close in the past 27 years and down just 9 time to defy the trade mantra of sell in May and come back in October.
The above reasons were enough to push NGX index decisively up towards its 200-day moving average for the second time in over two months.
The last two times that happened in 2025 bull market (the bull market never technically ended in the index), stocks continued soaring to new all-time highs (see chart below: the red line is the T line, green is 50MA while black line is the 200-day moving average).”