BANKS, AIRTEL lead stocks higher   

Nov 1 (Lagos) - The All stock Index of the Nigerian stock market was up 1.89% today and crossed the 70,000 mark let by gains in AIRTELAFRI and the banking stocks like GTCO , ZENITHBANK , ACCESS , UBA & FBNH among others. 

Some investors are rejoicing the recent quarterly results from Banks showing huge year on year gains but others who look deeper will be worried by the reasons that led to those increases. 

Huge Naira devaluations allowed banks to profit in Naira terms by investing in the US Dollar and they all did so. The question is that if this continues where will Nigeria's economy be in the near future? Myopic investors will not worry about that and celebrate for today but the reality is that we are not really gaining in Dollar terms. There is little to no organic growth being shown by these banks and that should be a big worry for investors because that means these banks are not doing much in their core mandate which is banking (lending and deposits). 

Market seems to agree with those worries as the stocks have not shown huge positive moves on these forex driven profits from the Banks. 

At the same time, investors should be happy that the Banks did gain from these devaluations that not gain from them. If they keep gaining like this, very soon there will be nothing left. We all will become billionaires and trillionaires and pay for bread in millions. That is what happened in countries like Zimbabwe where this story has already played itself. 

Other big gainer in the market today was a small cap stock CHAMS which gained almost 10%.

reporting for on Tuesday, November 1 2023 from Lagos, Nigeria

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