Stock Market Declines by 5.9% in September

By Goddy  Egene

The persistent bear run pushed the Nigerian Stock Exchange (NSE) All-Share Index (ASI) down by 5.9 per cent in September as investors continued to watch activities in the political environment.

The NSE ASI, which measures the aggregate value of the nation’s stock market, fell from 34,848.45 at the beginning of the month to 32,766.37 last Friday. 

Although the depreciation was an improvement compared with the 8.8 per cent drop recorded in the month of August, the performance would have been worse if not a growth recorded last week.

After three weeks of decline, the market rebounded two weeks ago, which was sustained last week, thereby moderating the month-to-date and year-to-date decline to 5.9 per cent and 14.3 per cent in that order.

According to analysts at Cordros Capital Limited, “Despite recent gains, we reiterate our negative outlook for the equities market in the short-to-medium term, amidst political concerns ahead of the 2019 elections, and absence of a positive market trigger. However, positive macroeconomic fundamentals remain supportive of recovery in the long term.”

Daily Performance

The equities had opened the week on negative note last Monday as profit taking in Nigerian Breweries Plc, Union Bank of Nigeria Plc and Okomu Oil Palm Plc, drove the NSE ASI down by 0.27 per cent to 32,451.27.

Similarly, market capitalisation shed N32.5 billion to close lower at N11.8 trillion, bringing the year-to-date decline to 15.1 per cent. Also, volume and value of trading fell compared to last Friday as investors traded 190.5 million shares valued at N3.3 billion.  

In all, 23 stocks depreciated compared with 13 that appreciated in value. Livestock Feeds Plc led the price losers, while Niger Insurance Plc led the price gainers.

 The NSE Banking Index recorded the highest sectoral growth. The index ended 0.2 per cent higher driven by continuing buy interest in Guaranty Trust Bank Plc, Zenith Bank Plc and United Bank for Africa Plc.

 Gains by bellwether tickers lifted the market on Tuesday. Highest capitalised stock, Dangote Cement Plc, Nestle Nigeria Plc, Nigerian Breweries Plc, FBN Holdings Plc are among the 26 stocks that drove the rebound. As a result, the index appreciated by 2.0 per cent    to close at 33,114.44. Similarly, market capitalisation added N242 billion to close higher at 12.09 trillion.

However, level of activity   was mixed as volume traded rose 17.1 per cent to 222.9 million shares   units while value traded declined 0.7 per cent to N3.3 billion. Zenith Bank (43.3 million shares), International Breweries Plc (37.0 million shares) and United Bank for Africa Plc (35.2 million shares) were the top traded stocks by volume while the top traded stocks by value are International Breweries  (N1.1 billion), Zenith Bank  (N923.6 million) and GTBank (N334.9 million).

The price gainers’ chart was led by Nestle Nigeria Plc with 10 per cent, trailed by Neimeth International Pharmaceuticals Plc with 9.6 per cent. First Aluminium Plc and   Veritas Kapital Assurance Plc chalked up 8.1 per cent and 7.6 per cent respectively.

Other top price gainers included:  WAPIC Insurance Plc (7.6 per cent); Nestle Nigeria Plc (6.7 per cent); International Breweries Plc (6.5 per cent); Vitafoam Nigeria Plc (6.0 per cent); Oando Plc (6.0 per cent) and NASCON Allied Industries Pl (5.9 per cent).

Conversely, Livestock Feeds Plc led the price losers with 8.7 per cent, trailed by Japaul Oil & Maritime Services Plc with 8.3 per cent. Union Diagnostic and Clinical Services Plc shed 7.8 per cent.

Other top price losers were: Presco Plc, Portland Paints (5.7 per cent); Total Nigeria Plc (5.1 per cent).

Performance across sectors was largely positive as four out of the five indicators tracked   closed higher. The NSE Consumer Goods Index led with 3.2 per cent, while the NSE Banking Index rose 1.5 per cent. In the same vein, the NSE Insurance Index grew by   1.0 per cent, just as   the NSE Industrial Goods Index climbed 0.7 per cent. On the contrary, the NSE Oil & Gas Index was the only decliner, shedding 0.2 per cent.

 The depreciation recorded in the share prices of companies such as Dangote Cement Plc, Flour Mills of Nigeria, Nigerian Breweries Plc pushed the market into the negative territory o Wednesday  after rebounding on Tuesday.   The index fell by 0.46 per cent to close lower at 32,963.27, while market capitalisation shed N55.2 billion to be at N12.0 trillion.

“We attribute the losses recorded today to prevailing negative sentiment across all sectors asides the banking sector. Nonetheless, we expect a positive close to the market at the end of the week, as investors take advantage of the low prices across the various sectors in the market,” at Meristem Securities Limited said.

However, amidst the bearish trading, the banking sector attracted   positive sentiments from investors which led to appreciation in five stocks.  They are Zenith Bank Plc, Union Bank of Nigeria Plc, Guaranty Trust Bank Plc and United Bank for Africa Plc that went up by 4.6 per cent, 3.9 per cent, 3.0 per cent, 1.3 per cent and 0.6 per cent in that order. Berger Paints Nigeria Plc led the price losers with 10 per cent, trailed by Prestige Assurance Plc with 9.8 per cent.  Royal Exchange Assurance Plc shed 9.0 per cent.

 The bearish performance was extended the local bourse was extended to the second consecutive trading session as profit taking in Nestle and Union Bank pulled the benchmark index down  0.61 per cent.  Activity level was, however, mixed as volume traded fell 10.4 per cent to 154.3 million shares while value traded rose 33.0 per cent to N2.7 billion.

There was mild bargain hunting on Friday leading to the appreciation in stock prices making the bourse to close the week positively.

Market Turnover

A total turnover of 924.546 million shares worth N14.194 billion in 14,119 deals were traded last week by investors, down from 1.370 billion shares valued at N19.503 billion that exchanged  hands  in 16,076 deals    the previous week.

 But the Financial Services Industry led the activity chart with 745.188 million shares valued at N9.477 billion traded in 8,329 deals, thus contributing 80.6 per cent  and 66.7 per cent  to the total equity turnover volume and value respectively.

The Consumer Goods Industry followed with 67.159 million shares worth N3.815 billion in 2,221 deals, the third place was Conglomerates Industry with a turnover of 49.297 million shares worth N135.395 million in 678 deals.

Trading in the top three equities namely – Guaranty Trust Bank Plc, United Bank for Africa Plc and Fidelity Bank Plc  accounted for 368.044 million shares worth N6.485 billion in 2,585 deals, contributing 39.8 per cent  and 45.6 per cent  to the total equity turnover volume and value respectively.

Also traded during the week were a total of 97,183 units of Exchange Traded Products (ETPs) valued at N1.511 million executed in four  deals, compared with a total of 29,750 units valued at N449,662.50 that was transacted  the preceding  week in two deals.

A total of 13,715 units of Federal Government Bonds valued at N13.242 million were traded last week in 49 deals compared with a total of 9,710 units valued at N9.587 million transacted two weeks in 19 deals.

Price Gainers and Losers

Meanwhile, 28 equities appreciated in price last   week, lower than 50 in the previous week, while 41 equities depreciated in price, higher than 25 equities of the previous week.

Niger Insurance Plc led the price gainers, chalking up 19.3 per cent,  trailed by Veritas Kapital Assurance Plc with 15.3 per cent.

UACN Property Development Company Plc chalked up 14.7 per cent, while First Aluminium Nigeria Plc  and Stanbic  IBTC Holdings Plc garnered 10.8 per cent and 9.5 per cent respectively.

Other top price gainers for the week included: Linkage Assurance Plc (9.3 per cent); University Press Plc (7.3 per cent); Cement Company of Northern Nigeria Plc (6.7 per cent); Neimeth International Pharmaceuticals Plc (6.4 per cent) and  Vitafoam Nigeria Plc (6.0 per cent).

Conversely, Union Bank of Nigeria Plc led the price losers for the week, shedding 12.1 per cent,  trailed by Union Diagnostic & Clinical Services Plc with 10.5 per cent.

Livestock Feeds Plc shed 9.5 per cent, just as Unity Bank Plc  and UAC of Nigeria Plc went down by 9.3 per cent apiece.

Other top price losers were:NAHCO (9.1 per cent); Associated Bus Company Plc (9.0 per cent); Guinness Nigeria Plc (9.0 per cent);Berger Paints Nigeria Plc (8.7 per cent) and Japaul Oil and Maritime Services Plc (8.7 per cent).