Stock Market Maintains Profit-taking Momentum, Drops by N949bn WoW

Kayode Tokede

Amidst the backdrop of the Nigerian financial landscape, the Nigerian stock market recorded a dismal performance for the week dropped by N949 billion Week-on-Week (WoW) in market capitalisation

Notably, the Nigerian Exchange Limited All-Share Index (NGX ASI) declined by 1.39 per cent WoW to close at 98,152.91 basis points.

Similarly, the market capitalisation of listed equities lost by N949 billion to close at N55.512 trillion.

On the sectoral front, performance was largely negative as the NGX Banking index declined by 3.10 per cent week on week. NGX Oil & Gas index recorded weekly loss of 1.41 per cent and NGX Consumer Goods index down by 1.15 per cent W-o-W.

Meanwhile, NGX Insurance and NGX Industrial Goods Indices recorded some pocket of gains of 0.02 per cent and 0.38 per cent respectively, for the week.

Market breadth for the week was negative as 27 equities appreciated in price, 43 equities depreciated in price, while 84 equities remained unchanged. SUNU Assurances led the gainers table by 25.00 per cent to close at N1.25, per share. CAP followed with a gain of 20.21 per cent to close at N28.85, while Livestock Feeds went up by 14.48 per cent to close to N1.66, per share.

On the other side, Oando led the decliners table by 19.57 per cent to close at N9.25, per share. Sovereign Trust Insurance followed with a loss of 18.18 per cent to close at 36 kobo, while Thomas Wyatt Nigeria declined by 16.82 per cent to close at N1.78, per share.

Overall, a total turnover of 1.839 billion shares worth N34.258 billion in 37,528 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 1.597 billion shares valued at N32.313 that exchanged hands previous week in 44,915 deals.

The Financial Services Industry (measured by volume) led the activity chart with 1.129 billion shares valued at N22.290 billion traded in 22,008 deals; contributing 61.38 per cent and 65.06 per cent to the total equity turnover volume and value respectively. The Conglomerates Industry followed with 194.179 million shares worth N2.822 billion in 1,923 deals, while the Construction/Real Estate Industry pulled a turnover of 130.702 million shares worth N649.957 million in 556 deals.

Trading in the top three equities; United Bank for Africa (UBA), Access Holdings and Transnational Corporation (Transcorp) accounted for 582.024 million shares worth N10.571 billion in 8,849 deals, contributing 31.65 per cent and 30.86 per cent to the total equity turnover volume and value respectively.

Financial analysts predicted a gradual gain in the Nigerian stock market driven by dividend qualifications, despite recent reversal signals.

In the just concluded week, investors’ sentiment remains bearish and weak despite the seeming oscillation in stock prices, which resulted in pocket of sell-offs and profit booking in some of the highly priced tickers as well as blue-chip companies.

The domestic equities market was in a see-saw mode as the benchmark all-share index closed last week below the 100,000 psychological mark for the second consecutive week at 98,152.91 index points resulting from the downbeat in market sentiments which came from sell-offs where investors continued shying away from equities due to promising outlook from risk-free markets.

On market outlook, the chief operating officer of InvestData Consulting Limited, Mr. Ambrose Omordion said, “we expect mixed sentiments to continue in the face of dividend investing and concerns for new capital base for the banks as more corporate earnings expected with dividend announcements, while taking advantage of pullbacks to position and rebalancing portfolio.

“This is amid the volatility and pullbacks that add more strength to upside potential. As such, investors should take advantage of price correction. Also looking at the trends and events across the globe and domestically.”

Looking ahead to the new week, Cowry Assets Management Limited anticipated a week of gradual gains in the market driven by dividend qualifications, despite recent reversal signals, saying that “despite these signals, there are entry opportunities emerging due to the oversold nature of the market.

“Our outlook remains mixed, contingent on several factors including macroeconomic reports and foreign exchange market activities. Meanwhile, we continue to advise investors on taking positions in stocks with sound fundamentals,” it said.