Equities market decreases by 0.33%

Investor sentiment remained cautious last week as the Nigerian Exchange Limited All-share Index (NGX ASI) declined by 0.33 per cent week-on-week to close at 97,506.87 basis points. Similarly, the overall market capitalisation decreased by N185 billion to close the week at N59.107 trillion.

Sectoral performance painted a varied landscape. The NGX Oil & Gas index dropped by 1.93 per cent W-o-W. The NGX Consumer Goods index shed 0.38 per cent, while NGX Banking index down by 0.28 per cent for the week.

Conversely, the NGX Insurance index recorded a weekly gain of 1.23 per cent, while the NGX Industrial Goods index increased by 0.62 per cent W-o-W.

The market breadth for the week was negative as 32 equities appreciated in price, 46 equities depreciated in price, while 75 equities remained unchanged. SUNU Assurance led the gainers table by 23.42 per cent to close at N3.90, per share. Haldane Mccall followed with a gain of 21.57 per cent to close at N6.20, while Sovereign Trust Insurance went up by 15.87 per cent to close to 73 kobo, per share.

On the other side, Austin Laz & Company led the decliners table by 26.32 per cent to close at N1.96, per share. John Holt followed with a loss of 18.91 per cent to close at N8.92, while Lasaco Assurance declined by 16.47 per cent to close at 31 kobo, per share.

Overall, a total turnover of 3.194 billion shares worth N54.850 billion in 45,112 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 1.952 billion shares valued at N35.864 billion that exchanged hands previous week in 48,553 deals.

The Financial Services Industry (measured by volume) led the activity chart with 1.509 billion shares valued at N26.904 billion traded in 20,357 deals; contributing 47.25 per cent and 49.05 per cent to the total equity turnover volume and value respectively. The Construction/Real Estate Industry followed with 839.945 million shares worth N4.806 billion in 1,399 deals, while the Oil and Gas Industry pulled a turnover of 256.445 million shares worth N13.307 billion in 6,313 deals.

Trading in the top equities Haldane McCall, FBN Holdings (FBNH) and Japaul Gold and Ventures (measured by volume) accounted for 1.587 billion shares worth N19.797 billion in 3,632 deals, contributing 49.69 per cent and 36.09 per cent to the total equity turnover volume and value respectively.

However, capital market analysts anticipated a mixed session and positive outing performance this week.

In the recently concluded trading week, the Nigerian stock market faltered after closing the month of November negative, closing in negative territory as investors grappled with a mix of profit-taking, sector rotation, and subdued optimism.

The benchmark NGX All-Share Index declined, underscoring bearish sentiment. This downturn was driven by a complex interplay of reactions to newly published macroeconomic data and cautious interpretations of Nigeria’s evolving economic narrative.

Last week commenced with the release of Nigeria’s third-quarter GDP report, which revealed a year-on-year growth of 3.46 per cent. This growth was powered by the vibrancy of the services and agriculture sectors, which sustained the momentum in the non-oil segment of the economy.

Meanwhile, the oil sector experienced modest gains, reflecting a slight increase in output. These developments, while positive, were juxtaposed against the Monetary Policy Committee’s decision to raise the Monetary Policy Rate (MPR) by 25 basis points. The less aggressive hike was an attempt to temper inflation, which reached 33.88 per cent in October, without stifling fragile growth.

On market outlook, the chief operating officer of InvestData Consulting Limited, Mr. Ambrose Omordion said, “we expect mixed sentiments to continue as players digest impacts of the latest rate hike, while rebalancing their portfolios midst of profit taking, bargain hunting, low valuation and position taking by smart money for year-end.

“Also, sector rotation and portfolio rebalancing continued in the market with investors taking advantage of pullbacks and correction to buy into value.”

He added that, ‘this is amid the volatility and pullbacks that add more strength to upside potential. Consequently, investors should take advantage of price correction.’

Looking ahead, Cowry Assets Management Limited, said “we expect a mixed sentiment as the year draws to a close with the prospect of a Santa rally, a seasonal uptick driven by increased liquidity and end-of-year optimism lingering in the minds of market participants.

“However, the technical picture remains clouded. The failed bullish hammer candlestick formation highlights lingering market weakness, while momentum indicators suggest a tentative recovery amidst persistent selling pressure.”

Cowry said, “we think investors will likely navigate these conflicting signals, balancing opportunities for bargain hunting against broader macroeconomic concerns. The interplay between rising inflation, monetary policy adjustments, and seasonal trends will shape the market’s path as it enters the final month of 2024.”