As 26 Stocks Decline, Market Sinks Further
The bearish sentiment of the equities market from the start of the week persisted on Thursday as the All-Share Index declined by 0.49 per cent to close at 43,326.89 basis points from 43,538.16 basis points.
The Nigerian Stock Exchange year-to-date return contracted to 13.3 per cent as 26 stocks slumped against 17 that advanced.
As a result, investors lost N75.8bn as market capitalisation fell to N15.5tn.
The drag in the market was largely attributed to sustained sell-offs across board with Nestle Nigeria Plc, Nigerian Breweries Plc and FBN Holdings Plc weighing the most on performance and depreciating respectively by five per cent, 3.2 per cent and 1.6 per cent.
However, activity level improved as volume and value traded appreciated by 336.9 per cent and 64 per cent to close at 2.2 billion units and N7.4bn, respectively.
Sector performance was mixed as three of the five market indices closed in the red while two appreciated.
Leading the losers’ chart was the consumer goods index which plummeted by two per cent following sell pressure in Nestle and Nigerian Breweries shares.
The insurance index following, also declining by 0.6 per cent on the back of price depreciation in Wapic Insurance Plc and Aiico Insurance PLc, which declined respectively by 4.4 per cent and 4.8 per cent.
In the same vein, the banking index fell by 0.1 per cent as Union Bank of Nigeria Plc, Diamond Bank Plc and Fidelity Bank Plc depreciated accordingly by 2.4 per cent, 4.8 per cent and 3.2 per cent.
However, the industrial goods index appreciated by 0.3 per cent owing to improvement in Dangote Cement Plc, which gained 0.4 per cent, while the oil and gas index rose by 0.6 per cent due to gains in Forte Oil Plc, which gained 4.9 per cent.
Investor sentiment improved compared to Wednesday’s equities performance following gains in 17 stocks and depreciation in 26.
At the close of trading, Unity Bank Plc, Forte Oil Plc and Royal Exchange Assurance Plc emerged s the top performing stocks, appreciating respectively by 9.4 per cent, 4.9 per cent and 4.8 per cent while Skye Bank Plc, Hallmark Insurance Plc and Nestle Nigeria emerged at the worst performing equities, sliding accordingly by 8.9 per cent, 5.3 per cent and five per cent.
Commenting on the state of the equities market, analysts at Afrinvest Securities, in a note, said, “While the bearish performance was in line with expectation, improving market breadth and turnover suggest some investors are taking advantage on the week-long sell off to buy into stocks with attractive valuation. Hence, we expect the ‘Buy the Dip’ sentiment to buoy performance in subsequent sessions.
FSDH Group Research in its equities broker perspective, said, “The bearish sentiment in the equity market is likely to remain to end the week. However, we expect an increase in market activity, as the market moves from the oversold position in subsequent trading sessions with bargain hunting by investors.”
Cordros Capital analysts, thus, said, “We believe that still-positive market fundamentals and improving macroeconomic conditions suggest legroom for further gains.”