The Nigerian Stock Exchange (NSE) major index gained the most on Friday to a three-week high after President Muhammed Buhari’s inauguration of cabinet ministers, boosting hopes for reforms that could lift growth for Africa’s biggest economy, traders said.
The stock market rose for the third session on Friday to 27,830 point, up 0.73 percent.
Analysts said the rise was a relief rally and that half-year corporate results, particularly from banks, were also supportive.
Local banks have been trading at low book values, weighed down by weak sentiment over the economy.
Stocks had been on a losing streak since end of May, when Buhari was sworn in, due to his failure to appoint a cabinet months after winning a second term in February’s election. That prompted foreign investors to trim their holdings.
The index of Nigeria’s top 10 lenders gained 2.18% while oil and consumer stocks rose marginally. Dangote Cement, the biggest firm by market cap, climbed 1.2%, to help lift the index.
Nigeria’s economy has grappled with low growth since recovery from recession three years ago. Buhari, who began a second four-year term in May, has pledged to revive the economy. But investors have been waiting for policy signals that could lift economic growth.
However, minister of finance, budget and national planning, Zainab Hamed told the National Executive Council (NEC) in Abuja on Thursday that the economy has seen eight successive quarters of growth since Nigeria emerged from the recession.
"Macro-economic stability has been achieved with growth in end Q3, 2019 at 3.01 percent; continued increase in Real GDP from 1.89 percent in Q2, 2018 to 2.01 percent in 2019; there has been significant growth in non-oil sector.," Ahmed said at the NEC meeting.
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