Stock Market Down N139bn on Profit-taking in FBN Holdings, Others

Kayode Tokede

The stock market of the Nigerian Exchange Limited (NGX) closed on a negative note from the prior week in four out of five trading sections due to continued sell-off in some stocks by investors who are beginning to position for the earning season.

The market capitalisation dropped by N139billion Week-on-week (WoW) to close at N27.803trillion, while the NGX All-Share Index shed 0.53 per cent W-o-W to close at 51,557.41 basis points.

Particularly, sell-offs in International Breweries, Union Bank of Nigeria (UBN), FBN Holdings (FBNH), FCMB Group and NASCON Allied Industries led the weekly loss.

Sectoral performance was largely bearish. The NGX Banking index declined by 0.31 per cent. NGX Insurance index recorded a weekly loss of 2.53 per cent, while NGX Oil & Gas index dipped by 0.41 per cent. On the other side, the NGX Consumer Goods Index and NGX Industrial Index rose by 1.42 per cent and 0.15 per cent respectively W-o-W.

The market breadth for the week was positive as 31 equities appreciated in price, 26 equities depreciated in price, while 99 equities remained unchanged. Academy Press led the gainers table by 48.82 per cent to close at N1.89, per share. UPDC followed with a gain of 20.39 per cent to close at N1.24, while Learn Africa went up by 11.11 per cent to close to N2.50, per share.

On the other side, R T Briscoe led the decliners table by 22.73 per cent to close at 34 kobo, per share. International Breweries followed with a loss of 14.29 per cent to close at N5.40, while MRS Oil Nigeria declined by 11.08 per cent to close at N14.45, per share.

Overall, a total turnover of 822.404 million shares worth N10.366 billion in 20,643 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 1.348 billion shares valued at N24.487 billion that exchanged hands previous week in 22,155 deals.

The Financial Services Industry (measured by volume) led the activity chart with 491.270 million shares valued at N 4.499 billion traded in 9,961 deals; contributing 59.74 per cent and 43.40 per cent to the total equity turnover volume and value respectively. The Conglomerates Industry followed with 81.698 million shares worth N218.285 million in 605 deals, while the Consumer Goods Industry pulled a transaction of 55.052 million shares worth N855.318 million in 3,093 deals.

Trading in the top three equities namely Guaranty Trust Holding Company (GTCO), United Bank for Africa (UBA) and Transnational Corporation (Transcorp) accounted for 244.025 million shares worth N2.680 billion in 3,732 deals, contributing 29.67 per cent and 25.86 per cent to the total equity turnover volume and value respectively.

The stock market trading activities for this week will be a short one on the NGX as the federal government declared Monday 11th and Tuesday 12th July 2022, as public holidays to mark this year’s Eid-el-Kabir celebration.

Following last week performance, analysts expected cautious trading on stock market to continue for the three days trading, as bargain hunting and indecisiveness by investors trail the market.

Also, they expected mixed trading in the midst of bargain hunting and portfolio reshuffling, ahead of the interim dividend season and second-half of the year, while investors digest the March audited accounts released.

In the new week, analysts at Cordros Securities Limited said “With the moderation in the prices of bellwether stocks this week, we expect savvy investors to take advantage of this and make re-entry ahead of the first half (H1), 2022 earnings season.

“However, we do not rule out the possibility of continued profit-taking activities. As a result, we think the local bourse will likely exhibit a choppy pattern. Therefore, we advise investors to take positions in only fundamentally justified stocks.”

Analysts at Cowry Assets Management Limited stated “In the new week, the anticipation of first half (H1), 2022 results are expected to act as catalyst to trigger more bullish sentiments. Also, we continue to maintain positive sentiments in the market while investors are advised to trade on companies’ stocks with good fundamentals and a positive outlook so as to avoid falling into the bear trap.”