Equities market drops by N421bn in one week as investors engaged in cautious trading 

The equities market of the Nigerian Exchange Limited (NGX) dropped by N421 billion in one week as investors engaged in cautious portfolio adjustments and sectoral realignments.

As a result of the market downturn, the All-Share index declined by 0.62 per cent to close the week at 107,821.39 points. Similarly, market capitalisation lost N421 billion week-on-week (W-o-W) to close at N67.193 trillion.

Also, sectoral performance painted a largely negative picture. The NGX Insurance Index emerged as the worst-performing sector, slumping by 4.56 per cent week-on-week. The NGX Banking index followed with a weekly decline of 3.08 per cent, while NGX Consumer Goods and NGX Industrial goods indices posted marginal declines of 0.36 per cent and 0.51 per cent, respectively.

On the flip side, the NGX Oil & Gas index emerged as the strongest performer for the week with a gain of 0.60 per cent, while NGX Commodity index rose by 0.53 per cent W-o-W.

The market breadth for the week was negative as 27 equities appreciated in price, 60 equities depreciated in price, while 63 equities remained unchanged. PZ Cussons Nigeria led the gainers table by 31.11 per cent to close at N35.40, per share. Caverton Offshore Support Group followed with a gain of 22.92 per cent to close at N2.95, while Livestock Feeds went up by 22.81 per cent to close to N7.43, per share.

On the other side, SUNU Assurance led the decliners table by 19.55 per cent to close at N5.31, per share. Eunisell Interlinked followed with a loss of 18.67 per cent to close at N9.80, while Learn Africa declined by 16.46 per cent to close at N3.30, per share.

Overall, a total turnover of 1.848 billion shares worth N51.387 billion in 63,090 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 2.001 billion shares valued at N49.486 billion that exchanged hands prior week in 70,853 deals. 

The Financial Services Industry (measured by volume) led the activity chart with 1.296 billion shares valued at N26.914 billion traded in 29,140 deals; contributing 70.13 per cent and 52.38 per cent to the total equity turnover volume and value respectively. The Services industry followed with 129.443 million shares worth N719.218 million in 3,657 deals, while the Consumer Goods Industry pulled a turnover of 116.696 million shares worth N4.185 billion in 7,452 deals. 

Trading in the top equities; Zenith Bank, FCMB Group and Access Holdings (measured by volume) accounted for 539.768 million shares worth N16.528 billion in 7,392 deals, contributing 29.21 per cent and 32.16 per cent to the total equity turnover volume and value respectively.  

Meanwhile, analysts have anticipated mixed sentiments in the Nigerian equities market with position-taking and portfolio reshuffling likely to intensify as investors await more audited results and dividend declaration.

The market closed last week on a bearish note through sustained sell pressure. This marked a significant breakdown below the 108,000 psychological level, reflecting weak market internals and subdued trading volumes. The downturn came amid the ongoing corporate earnings season and portfolio rebalancing across market sectors, driven in part by developments in the fixed-income market and mixed earnings reports from listed companies.

Looking ahead, analysts at Cowry Assets Management Limited said, “the equities market is expected to maintain a mixed trajectory in the coming week. While profit-taking activities may persist, there is a likelihood of a slight recovery as investors reposition their portfolios based on earnings results. 

“The influx of audited corporate earnings reports is anticipated to influence market sentiment, particularly for stocks with strong fundamentals. Investors are advised to remain vigilant, focusing on stocks with strong fundamentals to make informed investment decisions.”