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Stocks Rebound On OPEC’s Agreement To Cut Production First Time In 8 Years

Nigerian stocks advanced by 0.04 percent on Thursday to close at 28,247.56 points, after a rebound in the Oil and Gas sector, following reports of an agreement by OPEC members to cut production for the first time in eight years which drove upbeat sentiments on the domestic bourse. “Today’s performance increased the Month-to-Date gain to 2.35 percent and decreased the Year-to-Date loss to 1.38 percent.

At the close of the session on the Nigerian Stock Exchange (NSE), the Oil and Gas and Insurance indices appreciated by 3.07 percent and 0.82 percent apiece, following rallies in the shares of Nigeria’s first dual listed independent indigenous upstream exploration and production firm, Seplat Petroleum Development Company Plc and oil marketers, Oando Plc and Conoil Plc, the trio gaining 5.00 percent, 6.92 percent each and 4.72 percent respectively. While reinsurer, Continental Reinsurance Plc gained by 5.00 percent, and insurers, Nem Insurance Plc and Law Union & Rock Plc climbed up by 5.00 percent and 8.96 percent each.

On the flipside, price declines in the shares of Nigeria’s top tier lenders, Guaranty Trust Bank Plc and Zenith Bank Plc saw both stocks losing by 2.25 percent and 0.51 percent each, financial HoldCo, FBN Holdings Plc lost by 0.94 percent to weigh down the Banking index.

Also, beverage producer, SevenUp Bottling Company Plc, Nigeria’s brewing giant, Nigerian Breweries Plc and Flour Mills of Nigeria Plc all declined by 2.46 percent, 1.07 percent and 0.09 percent respectively to drag the Consumer Goods index down by 0.04 percent. The Industrial Goods index however closed flat.

At the close of trading on the domestic bourse, market breadth posted a positive outlook, with 25 gainers and 18 losers recorded, according to the NSE daily market statistics. Mid-tier lender, Wema Bank Plc emerged the top gainer with a gain of 0.06 kobo per share; while cement manufacturer, Ashaka Cement Plc topped the losers list with a loss of 0.85 kobo per share.

In terms of turnover, total volume traded rose by 129.73 percent to 365.37 million shares, valued at N2.09 billion, and traded in 2,905 deals.

“Following speculations that the proposed OPEC deal may likely come up against a brick wall (thus weakening appetite in the Oil & Gas sector), we view today’s gain as a dead cat bounce and expect sentiments to reverse in tomorrow’s session,” Cordros update affirmed.

About Editor

Otunba Sayo Akintola is a 1992 graduate of Linguistics from the University of Ibadan, Oyo State. He holds a post-graduate diploma in Financial Management and MBA from Abubakar Tafawa Balewa University, Bauchi. He started his 12-year sojourn in journalism at the Nigerian Tribune in 1993 as Business and Economy reporter. He rose through the ranks to become the Group Business Editor of the nation’s oldest surviving private national newspaper, the Nigerian Tribune. He set up World Street Journal magazine in 2018.

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