The equity market rose 0.11 per cent on Tuesday, as the Central Bank of Nigeria’s Monetary Policy Committee raised the policy rate to 26.25 per cent.

Investors’ sustained buy interest in banking and consumer goods sectors maintained the market’s upward trajectory.

The CBN-MPC on Tuesday increased the benchmark interest rate by 150 basis points to 26.25 per cent from 24.75 per cent set in March.

The CBN governor attributed the third consecutive hike in bank interest rates in 2024 to continued efforts to moderate inflation, which reached 33.69 per cent in April 2024, according to the National Bureau of Statistics (NBS).

Reacting, a stockbroker, Victor Ibrahim, said investors did not react to the CBN-MPC decision because the hike on the monetary policy rate is targeted at tightening inflationary pressure due to the increase in goods prices.

In an interview in Lagos, Mr Ibrahim told journalists that the equity market does not have a direct correlation with the prices of goods. Hence, the hike in the policy rate did not affect its performance.

He explained that though the CBN-MPC’s decision to control inflation was laudable, the apex bank needed to make a decision that addressed both monetary and fiscal policies to yield desirable results and curb the country’s current inflation.

According to him, investors did not react negatively to the CBN-MPC decision because the stock market is just overcoming sentiments from the CBN directive on the Bank’s recapitalisation exercise.

The stock broker noted that the equity market has recently experienced a market reversal and share price correction, especially for the shares of banking stocks, which have been greatly affected for some time.

Meanwhile, the Nigerian Exchange Ltd. (NGX) market capitalisation gained N61 billion or 0.11 per cent to close at N55.597 trillion, as against N55.536 trillion recorded on Monday.

The All-Share Index which opened at 98,176.58 also advanced by 0.11 per cent or 109 points to close at 98,285.33.

Consequently, the Year-To-Date (YTD) return rose to 31.44 per cent.

Market breadth closed flat, with 20 gainers and 20 losers traded on the floor of the Exchange.

On the gainers table, Berger Paints led by 9.96 per cent to close at N14.90, Nestle trailed by 9.76 per cent to close at N900 per share.

Sovereign Trust Insurance gained 8.11 per cent to close at 40k, Royal Exchange added 7.14 per cent to close at 60k and Tantalizers rose by 6.38 per cent to close at 50k per share.

On the other hand, International Energy Insurance led the losers’ table by 9.70 per cent to close at N1.49, and Deap Capital Management and Trust Plc followed by 8.33 per cent to close at 44k per share.

UPDC Real Estate Investment Trust also lost 7.69 per cent to close at N1.20, WAPIC declined by 7.25 per cent to close at 64k and Sterling Nigeria shed 6.25 per cent to close at N4.20 per share.

Analysis of the market activities showed trade turnover settled lower relative to the previous session, with the value of transactions declining by 23.02.per cent.

A total of 222.90 million shares valued at N5.15 billion were exchanged in 7,228 deals, compared to 405.66 million shares valued at N6.69 billion exchanged in 8,439 deals posted in the previous session.

Meanwhile, GTCO led the activity chart in volume and value with 40.64 million shares worth N1.62 billion, followed by Access Corporation with 27.52 million shares valued at N469.13 million.

United Bank for Africa(UBA) sold 23.96 million shares valued at N502.44 million; Transnational Corporation traded 22.83 million shares valued at N260.68 million.

Also, Jaiz Bank transacted 11.55 million shares worth N24.30 million.

(NAN)