Nigeria stocks rose 2.28 percent in early trades, its biggest one-day rally in three months, after Opec agreed this week to cut crude oil output to rein in a global glut. Nigeria's stock market has fallen 11.8 percent this year as worries about a deepening recession in Africa's largest economy, brought on by a plunge in oil prices and output, kept foreign investors on the sidelines.
The low oil price has slashed government revenues, weakened its currency, prompting it to deplete its dollar reserves to try to support the naira. "It is inevitable the market is responding to the positive news of price recovery," stock broker Yusuf Rasheed said, referring to oil. The main share index added 576.8 points to reach 25,841 points at 1121 GMT, its highest level since September 1.
Oil prices steadied at around $53.50 a barrel on Friday after the biggest weekly rally since 2009 following Opec's agreement. Oil retailers Mobil and Forte Oil led the gains, rising the maximum 10 percent allowed on the exchange. Energy firm Oando also gained 9.82 percent. Nigeria's biggest listed company, Dangote Cement, rose 6.49 percent to pull the index higher. Stockbroker Rasheed said the equity market had been depressed by dollar shortages, which limited foreign participation. With the recovery in oil prices, Nigeria expects its foreign reserves to increase, which will good for equities, he said.
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