The Index Circuit Breaker has been triggered on the Nigerian Stock Exchange, thus suspending all securities trading for 30 minutes on Thursday as buying pressure pushed the All Share Index above 5%.
Trading will resume at 1:35:24 pm Nigerian time.
The buying interest seen on the listed equites on NSE continued on Thursday with ASI rising by 5.08% pushed by gains in both blue chip stocks and penny stocks as the euphoria rages on.
The market capitalization crossed 18 trillion on Thursday. Over 60 equities have advanced on Thursday with just 6 declining prior to the suspension of trading.
The advancers were lead by Bua Cement, (+10%), Airtel Africa (+10%), CADBURY (+10%), PRESCO (+10%+. In total 8 stocks have gained 10% while 32 gained between 8% to 9.9% including ZENITHBANK (+9.38%), UNILEVER (+9.76%), GUINESS (+9.81%) among others.
On Wednesday Investors gained N324.62 billion as the Index rose by 1.90% gain. Similarly on Tuesday, the benchmark All-Share Index appreciated by 1.25%, with the wealth of Investors increasing by N211.132 billion. On Monday the Index surged by 3.96%.
About Circuit Breaker rules
According the Exchange, Circuit breakers are trading halts used by exchanges to guard against sharp fluctuations on the market. They are designed to give the market an opportunity to take a break and adjust to all available information before re-opening the market.
They provide protection against excessive volatility during continuous trading sessions of the market. Circuit breakers provide the opportunity for greater information dissemination and assimilation to all market participants, including investors to facilitate better informed investment decision making during periods of high market volatility.
On The Nigerian Stock Exchange (The Exchange) circuit breakers will be triggered during periods of extraordinary volatility in the equities market in order to maintain an orderly market, and to allow liquidity to re-aggregate.
The purpose is to dampen extraordinary volatility swings on market prices by providing time to restore equilibrium between buyers and sellers. Circuit breakers have the objective of dampening both market upswings and market downswings, and will complement the price limits on individual stocks already in place.
The Exchange, through the Index Circuit Breaker Rule, seeks to promote just and equitable principles of trade, remove impediments to and improve the mechanism of a free and open market; and protect investors and the public interest.
The circuit breaker threshold will be set by the Exchange from time to time. The Exchange has determined to set the threshold at 5% for the first trigger and a further 5% for the second trigger in the same direction.
By; Ifunanya Ikueze