The Nigerian Stock Exchange (NSE or The Exchange) recorded an increased bond market capitalization, as its income market rose by 35.52% to N17.50 trillion in 2020.
This was disclosed in the annual Market Recap and 2021 Outlook hosted by NSE on the 19th of January 2021 by the Chief Executive Officer of NSE, Mr. Oscar N. Onyema, OON.
Market capitalization, commonly called market cap, is the market value of a publicly traded company’s outstanding shares. It is equal to the share price multiplied by the number of shares outstanding.
According to Mr. Onyema, The Nigerian equities market got off to a strong start in 2020, returning 10.4% by the eighth trading session.
However by October, the equities market entered a much awaited bull run. Buoyed by the formal declaration of the U.S president-elect, unattractive fixed income yields, and better-than-expected corporate earnings.
Moreover, the NSE’s ASI (All Share Index) recovered from Q1’20, to close the year at 40,270.72 (+50.03%) and erase losses of -14.90% recorded in 2019.
During its remarkable year-end run, the ASI gained 6.23% in a single trading session which triggered a 30-minute halt of trading on all stocks for the first time since the NSE Circuit Breaker was introduced in 2016 to safeguard market integrity in periods of extraordinary volatility.
Speaking on the market capitalization of NSE at the close of the year, Mr. Onyema said that the NSE’s equity market capitalization was up by 62.42%, from N12.97 trillion in 2019 to N21.06 trillion in 2020 while market turnover saw an uptick of 7.25%, from N0.96 trillion in 2019 to N1.03 trillion in 2020.
Although Initial Public Offering activity was mute, the value of supplementary issues increased dramatically from 2019, rising by 851.37% to N1.42 trillion, from N148.77 billion.
Similarly, Capital-raising activities in the fixed income market increased significantly in 2020. The NSE’s bond market capitalization rose by 35.52% from N12.92 trillion in 2019 to N17.50 trillion.