Nigeria | NGX

In July, bearish sentiments returned to the exchange, with the benchmark index contracting by 2.28% to close at 97,774.22 points. As a result, the year-to-date (YTD) return moderated to 30.76%. The downturn was influenced by negative reactions to earnings reports and proposed regulatory changes (such as the introduction of a windfall tax on banks' realised foreign exchange gains). 

The landscape of Nigeria's oil and gas sector continues to unfold with pivotal transformations. Aided by the foundations laid in 2023, the sector is poised for significant leaps across its diverse segments. 

The outlook for CPO prices is tilted to the upside in H2'24, driven by constrained supplies due to stagnating global palm oil production and higher biodiesel mandates. Additionally, global demand is expected to remain robust, further supporting higher CPO prices. This combination of higher prices and improved volumes bodes well for the outlook of local players.

Presco Plc (PRESCO) outperformed our expectation in H1'24, with its EPS of N38.88 (at 94.6% of our previous full-year estimate), necessitating a rejig of our projections.

The global economy is dynamic. Hence, investment strategy must evolve to keep pace and remain relevant.

Despite prevailing macroeconomic conditions, NESTLE grew revenue by 43.4% YoY in Q1'24. However, earnings were eroded by higher production costs and foreign exchange losses.