Lagos – Transactions on the Nigerian Stock Exchange (NSE) on Wednesday reacted positively to the reduction of the Monetary Policy Rate (MPR) by the Central Bank of Nigeria (CBN).
The MPR was reduced by the CBN on Tuesday from 13 per cent to 11 per cent,
The News Agency of Nigeria (NAN) reports that the market indices appreciated by 0.53 per cent on Wednesday against the steady depreciation in the last one week.
Market operators had predicted that the reduction of the MPR could boost market activities if properly managed.
They told NAN that the rate cut would enhance market activities as investors were already looking for other investment windows.
Malam Garba Kurfi, the Managing Director, APT Securities and Funds Ltd., said that the slash in the rate would discourage people from saving.
He said that people would now invest in the capital market for higher returns.
The bank’s monetary policy committee also cut the Cash Reserve Ratio (CRR) to 20 per cent from 25 per cent.
The MPR is the benchmark interest rate at which the CBN lends to banks to cover their immediate cash shortfalls.
The market capitalisation also rose by N50 billion or 0.53 per cent to close at N9.538 trillion against N9.488 trillion recorded on Tuesday due to price gains.
Similarly, the All-Share Index, which opened at 27,596.81, appreciated by 147.11 points or 0.53 per cent to close at 27,743.92.
A breakdown of the price movement indicated that Dangote Cement led the price gainers’ table, growing by N1.99 to close at N159.99 per share.
GTBank followed with a gain of 99k to close at N21.99, while Nigerian Breweries appreciated by 98k to close at N116.70 per share.
Caverton garnered 22k to close at N2.59, while Ikeja Hotel rose by 16k to close at N3.39 per share.
On the other hand, Mobil topped the losers’ chart, dropping N6.94 to close at N132.05 per share.
Guinness trailed with a loss of N2 to close at N120, while Julius Berger shed N1.97 to close at N37.53 per share.
International Breweries lost 50k to close at N16, while ETI shed 50k to close at N16 per share.
Diamond Bank was the most traded equity with 69.02 million shares worth N164.05 million.
Zenith Bank traded 28.36 million shares valued at N453.69 million, while GTBank sold 25.56 million shares worth N537.19 million.
FBN Holdings accounted for 10.28 million shares worth N51.24 million, while UBA exchanged 7.26 million shares valued at N26.89 million.
In all, investors’ staked N2.75 billion on 203.82 million shares in 2,408 deals.
This was in contrast to the 176.39 million shares worth N3.06 billion traded in 3.,011 deals on Tuesday. (NAN)