Business

Investors dump banks’ stocks as CBN ends forbearance regime

Following the CBN’s directive suspending dividend payments, bonus disbursements, and offshore investments for banks under regulatory forbearance, the equities market opened the week on a negative note, as investor sentiment weakened amid concerns over earnings retention and capital constraints within the banking sector.

Consequently, the All-Share Index (ASI) of the Nigerian Exchange Limited (NGX) declined by 0.19 percent to 115,238.24 basis points, wiping N140.22 billion off market capitalization to close at N72.67 trillion.

The market downturn was spurred by sell pressure in Tier 1 banking ticker; Zenith Bank, United Bank for Africa, First Holdings Company and Access Holdings, having shed 6.37 percent, 5.67 percent, 6.03 percent and 8.28 percent, respectively; thus outweighing buy interests in MTN Nigerian Communication, BUA Foods and International Breweries
Accordingly, the Month-to-Date and Year-to-Date returns moderated to +3.2 percent and +12.0 percent, respectively.

Market breadth closed negative with declining issues outnumbering the advancing ones.

On the performance board, top gainers included Guinea Insurance, Ellah Lakes and Legend Internet Services as their share prices inclined by 10.0 percent, 9.93 percent and 9.87 percent, respectively; while Northern Nigeria Flour Mills, C&I Leasing and University Press Limited led the losers after their share value dipped by 10.0 percent, 9.68 percent and 9.27 percent, respectively.

Sectoral performance was broadly weak, with losses in Banking , Insurance, Consumer Goods, Oil/Gas, and Commodities by 1.19 percent, 0.49 percent, 2.73 percent and 2.66 percent, respectively while Industrial Goods rose 0.42 percent.

Analysis of market activities for the day showed trade turnover settled higher relative to the previous session, with the value of transactions up by 22.61 percent.

A total of 721.75 million units of shares valued at N22.01 billion were exchanged in 22,100 deals.

Access Holdings led the volume chart with 92.70 million units traded while Zenith Bank led the value chart in deals worth N3.56 billion.

READ MORE FROM: NIGERIAN TRIBUNE

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