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0 News Ghana, Latest Updates and Breaking News of Ghana, Roger A. Agana, https://newsghana.com.gh/nigerian-equities-hold-steady-near-highs-as-investors-await-q4-gdp-data-amid-inflation-concerns/
Nigerian equities remain resilient, hovering near recent highs as the NGX All Share Index consolidates within the 108,000–108,500 range. Market participants are cautiously optimistic, awaiting the release of Q4 2024 GDP data, which could provide further clarity on the nation’s economic trajectory.
The latest figures from Q3 2024 showed the economy growing at its fastest pace since Q4 2023, with a year-on-year expansion of 3.46%. This growth was primarily driven by a 3.37% increase in the non-oil sector, which continues to play a pivotal role in Nigeria’s economic recovery.
The services sector emerged as a standout performer, recording a robust 5.19% growth and contributing 53.58% to the GDP. Within this sector, financial and insurance services saw an impressive surge of 30.8%, reflecting increased activity and confidence in the financial markets. Meanwhile, the oil sector, which has long been a cornerstone of Nigeria’s economy, expanded by 5.17% as crude production rose to 1.47 million barrels per day. While these positive indicators could bolster market sentiment, lingering inflationary pressures and policy uncertainties remain significant risks that could dampen investor enthusiasm.
In the latest trading session, market breadth was weak, reflecting the cautious mood among investors. Eight sectors closed lower, five remained flat, and only five managed to end in positive territory. Heavyweights such as Dangote Cement, Bua Foods, MTN Nigeria Communications, and BUA Cement saw no change in their stock prices, while Guaranty Trust Holding gained 1.04%. On the other hand, major banking stocks like Zenith Bank, Access Holdings, and FBN Holdings experienced declines, underscoring the prevailing sense of caution in the market.
Adding to the uncertainty, Central Bank of Nigeria (CBN) Governor Olayemi Cardoso has raised concerns about the potential impact of U.S. tariff hikes on Nigeria’s already elevated inflation rate, which stands at 24.48%. Cardoso warned that higher tariffs could exacerbate inflationary pressures, driving up food prices, fuel costs, and borrowing rates. These rising costs could, in turn, weigh on consumer demand and squeeze industrial margins, posing challenges for both the manufacturing and financial sectors.
The combination of strong GDP growth and persistent inflation creates a complex environment for investors. While the economy’s expansion signals resilience and potential opportunities, the risks posed by inflation and external factors like U.S. tariffs cannot be ignored. As market participants navigate these uncertainties, the focus remains on how policymakers will address these challenges to sustain economic momentum and stabilize the financial landscape. For now, the Nigerian equities market remains in a holding pattern, with investors biding their time for clearer signals on the road ahead.
News Ghana, Latest Updates and Breaking News of Ghana, Roger A. Agana, https://newsghana.com.gh/nigerian-equities-hold-steady-near-highs-as-investors-await-q4-gdp-data-amid-inflation-concerns/
