Positive momentum continues for Nigeria's equities

Nigeria's equities market has been a focal point for investors and analysts as the country navigates through economic challenges and seeks to spur growth. Dolapo Ashiru, Managing Director at Lead Securities and Investment, shared insights on the market and the outlook for the future in a recent interview on CNBC Africa. The trading session review highlighted the cautious optimism surrounding the economic recovery plan and its potential impact on the market. Ashiru expressed his belief that the market may remain relatively flat in the short term, with a potential for a 'Santa Claus rally' towards the end of the year. However, he emphasized that significant recovery in the market may not be expected until the second half of the year, citing key factors such as exchange rate stability, oil prices, and access to credit as critical determinants for market performance. Despite the challenges ahead, Ashiru outlined potential opportunities for investors, particularly in select banking and consumer goods stocks. He recommended 'cherry picking' undervalued stocks such as UBA, Zenith Bank, GT Bank, Access Bank, as well as Dangote Cement. As institutional players navigate market volatility and fixed income instruments, Ashiru highlighted the need for a cautious approach, noting the potential for portfolio realignment in response to market dynamics. Looking ahead, Ashiru anticipated a slow start to trading activity in the new year, with market participants adjusting to post-holiday realities and awaiting key economic data, including inflation figures. However, he projected a potential increase in market activity by February or March as corporate results drive market sentiment. The interview underscored the delicate balance between uncertainty and optimism in Nigeria's equities market, with investors urged to stay vigilant and strategic in their investment decisions amidst evolving economic conditions.