Nigeria’s benchmark stock index rose to the highest in more than four years as investors speculated that lenders will post positive year-end earnings.
The Nigerian Stock Exchange All-Share Index advanced 1.4 percent to close at 33,814.56 in Lagos, the commercial capital, the highest since Nov. 25, 2008. Of 198 securities on the gauge, 25 gained while the same number retreated, according to data compiled by Bloomberg.
Investors are expecting “good results for the end of 2012 and to be delivered a good dividend,” Femi Ademola, an equity analyst at BGL Plc, said by phone from Lagos today. Nigeria’s banks may start reporting year-end earnings in March “and the next few weeks will be very interesting,” he said.
Nigeria implemented banking reforms following a debt crisis in 2008 and 2009 triggered by loans given to stock market speculators. The central bank fired eight chief executives of the country’s 24 banks and set up a company to buy lenders’ bad debts and stabilize the industry, reducing toxic assets the banks were holding.
FBN Holdings Plc, Nigeria’s second biggest bank by market value, gained 0.9 percent today, extending its rally this year to 27 percent. Nine-month profit climbed 49 percent to 66.26 billion naira ($421 million), the Lagos-based bank said in October. Access Bank Plc, the country’s sixth-largest lender, gained for a second day, increasing 0.6 percent.
The index of Africa’s biggest oil producer and second-largest bourse has jumped 20 percent this year, the second-best performer globally.
Nigeria, Africa’s most populous nation with more than 160 million people, increased equity investment limits for pension funds to 50 percent from 25 percent to help boost trading in the stock market, Ehimeme Ohioma, head of investment supervision of the Nigerian Pension Commission, said in November.
Pension funds in the West African country have 3 trillion naira ($19 billion) of assets, according to Ohioma.
“Local pension funds seem to be shifting into equities, and global investors -- including many first-time visitors to Lagos -- are interested in Nigerian assets, but without market over-excitement that would worry us,” Charles Robertson, the London-based chief economist at Renaissance Capital, wrote in a research report today.