By NKIRUKA NNOROM

The Oil and Gas Index of the Nigerian Stock Exchange, NSE, rose the most in the first half of the year driven by activities of indigenous oil firms, says a report by Financial Derivatives Company, FDC.

Specifically, the NSE Oil and Gas Index recorded 33.24 percent growth year-to-date to outperform the other sectorial indices.

The Exchange presently publishes seven indices, which include the NSE 30 Index, NSE Lotus Islamic Index (NSE LII) and five other sectorial indices – the NSE Banking, the NSE Consumer Goods, the NSE Oil & Gas, the NSE Industrial and the NSE Insurance indices.

The NSE 30 Index was developed in 2007 as a major stock market index that tracks the performance of 30 most liquid stocks representing industry sector, while the NSE Lotus Islamic Index (NSE LII) was launched in 2012 and consists of companies whose business practices conform with the principles of Shari’ah.

The sectoral indices comprise the top fifteen most capitalised and liquid companies in the Insurance and Consumer Goods sectors, top ten most capitalised and liquid companies in the banking and industrial goods sector and the top seven most capitalised and liquid companies in the oil & gas sector.

The report presented by the Managing Director of FDC, Mr. Bismarck Rewane, in the company’s monthly economic news and views at the Lagos Business School Executive Breakfast Meeting, showed that the Oil and Gas Index was trailed far behind by Industrial Indices with 4.95 percent increase, while NSE 30 Index followed with 0.60 percent growth.

However, the Consumer Goods Index recorded the highest losses during the period, dropping by 5.13 percent, followed by NSE Insurance Index, which declined by 4.38 percent and the NSE Banking Index, which went down by 3.53 percent within the same period, ‘but has continued to improve’.

The report further showed that indigenous oil companies gained the most in the month of June led by Oando Plc with 60.63 percent price appreciation. This was followed by MRS Oil Plc with 35.95 percent gain; Conoil Plc, which appreciated by 35.01 percent and Eterna Plc that rose by 29.63 percent.

Though the report affirmed that there has been marked improvement in the market within the quarter, it stated that All Share Index, which measures the performance of the stock market rose by marginal 2.79 percent as against 28.80 percent growth recorded in the corresponding period in 2013.

Agreeing with the report, Mr. David Adonri, Managing Director, Highcap Securities Ltd and Mr. Diekola Onaolapo, Managing Director, Eczellion Capital, said that two factors were responsible for the positive movement in the oil and gas sector, which is the favourable disposition towards Forte Oil and Oando’s shares by investors.

They observed that Oando’s shares have moved up massively in recent time, especially in the last 10 days, due to the consent secured from the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, for acquisition of Nigerian upstream oil and gas business of ConocoPhillips and Forte Oil Plc for its 2013 and 2014 quarterly financial reports and accounts, which are well received in the market.