The Nigerian stock market rebounded in November as the decision by the Central Bank of Nigeria (CBN) to restrict individuals and local firms from investing in its open market operations (OMO) auctions impacted positively on the market.
Contrary to a decline of 4.9 per cent suffered by the Nigerian Stock Exchange’s (NSE) All-Share Index (ASI) in October, the market benchmark gauge appreciated 2.4 per cent in November. Similarly, the market, which dipped by N642 billion in October, gained a total of N204 billion in November.

While the NSE ASI appreciated from 26,355.35 to 27,002.15, market capitalisation rose from N12.829 trillion to N13.033 trillion.
Market operators and other stakeholders attributed the rebound recorded in the market to renewed demand for stocks as some investors shifted focus from fixed income securities following the central bank’s policy.
Also, there was significant bargain hunting in the month under review as investors took advantage of the attractive valuations as many of the equities dipped to a two-year low.
A stockbroker, Mr. Ayo Oguntayo, confirmed that the performance of the market in November reflected how a positive pronouncement could easily impact the fortunes of the equities market.
According to him, while the market has potential to deliver good returns to investors, the high yields on fixed income securities over the years discouraged many investors from the market.
“But the situation will keep improving. You can see how the CBN’s policy on OMO, which drove down the yields on fixed income securities, attracted patronage to the equities market. The stock market has potential to  handsomely reward investors who are not risk averse. Last week alone, for instance, some stocks recorded capital appreciation of between 11 per cent and 30 per cent,” Oguntayo said.
The   Managing Director/CEO of Network Capital Limited, Mr. Oluropo Dada, recently said the  market, more than ever before, presented an overwhelming buy opportunity for investors in the face of the attractive valuations and CBN’s OMO policy.
“The market fundamentals, despite the persistent illiquidity, are still very strong and prices of quoted securities can only go up, which will be triggered by both arbitrage income and dividend income. Based on the third quarter results being released by the quoted companies, especially the  banks, the market is where to be now,” Dada said.
A market analysts, Mr. Ambrose Omordion of Invest Data Limited, said  that hopes were high that CBN’s unconventional monetary policy move that sought  to stimulate the economy, by ensuring liquidity was available to the real sector, was expected to result in the cost of funds reduction soon to the nation’s productivity sector.
“This would eventually support the stock market, improving the performance of listed companies, driving prices. It would eventually enhance liquidity in the stock market, given the restriction on classes of those who can invest in the CBN’s OMO and TBs,” he said.
Mr. Michael Nwakalor of CardinalStone Partners Limited  had anticipated a turnaround in the fortunes of the equities following the CBN’s decision.
“There is real hope this could be good for equities. We should see a lot of corporate heavyweights gain in coming weeks as pension funds look for high-yielding investment,” he said.
The CBN in the last week of October, had  prohibited individuals and local firms from investing in both its primary and secondary OMO auctions.
The central bank’s directive was contained in a circular titled: “Re: Open Market Operations Auctions,” dated October 24, 2019, and signed by its Director, Financial Markets Department, Dr. Angela Sere-Ejembi.
Since the directive, investing in OMO bills has been for banks and foreign investors alone.