The Nigerian Stock Exchange, NGX, All-Share Index recorded a significant decline in April, losing N3.57 trillion in market value.
This drop represents the first monthly decline for the NGX this year, contrasting with gains of 17.7%, 12.47%, and 5.64% recorded in January, February, and March respectively.
Despite this setback, the NGX is still up by 31.36% year-to-date.
READ ALSO: ‘Wizkid Is My Favourite Artiste’, Says Real Madrid Star, Rudiger
The sharp drop in the index was influenced by several policy announcements from the Central Bank of Nigeria, CBN, which notably announced a new recapitalization plan for commercial banks, aiming to raise an estimated N4 trillion in fresh capital over the next two years.
Also added to the market’s reaction was the decision by the CBN’s Monetary Policy Committee, MPC, to increase the benchmark interest rate by 200 basis points, moving from 22.75% to 24.75%.
The significant increase in interest rates by the Central Bank of Nigeria has also played a crucial role in this shift. The higher rates have diverted trillions of naira from the stock market to the fixed income market, as investors seek out higher yields.
Leave feedback about this