Stocks hit three-month high on strong earnings, FX moves

Stocks trading on the floor of the Nigerian Stock Exchange hit a three-month high on Tuesday, lifted by company earnings results that outperformed market expectations and hopes that a new currency-trading window will help lure investors back to Africa’s biggest economy, analysts said.

The market all share index rose 0.77 percent to 25,965 points, led higher by banking and oil stocks.

In a client briefing note, Vetiva Capital noted corporate results were better than expected and said it anticipated increased demand for Nigerian stocks this week. Dangote Cement, owned by Africa’s richest man Aliko Dangote, which accounts for a third of the market capitalisation, reported a 34 percent rise in post-tax profit, beating the market consensus.

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In a boost for investors in Nigerian equities, the central bank last week allowed portfolio investors to trade the naira currency at a market-determined exchange rate and increased dollar sales on the interbank market.

After the slump in the global price of oil, Nigeria’s main export, the Central Bank imposed a raft of capital controls to protect its dwindling hard currency reserves.