Local stock market sheds N149bn amidst selloffs of bellwether

Last week, the Nigerian equities market closed on the red line as the benchmark index depreciated by 0.68 per cent as selloffs of high capitalised stocks pulled the market down amidst mixed trading.

Basically, the All-Share Index of the Nigerian Exchange (NGX), after the five-day trading sessions shed 284.94 basis points, closing the period at 41,882.97 basis points.

Consequently, market capitalisation fell by N149 billion, closing at N21.854 trillion, which also represented a 0.68 per cent depreciation in value.

The weekly performance was driven by selloffs in bellwether stocks like Dangote Cement, UACN, Custodian Investment, and May & Baker.

During the week under review, the performance indexes across sectors were up, except for the NGX Industrial Goods that closed 5.42 per cent lower, while the NGX Banking led the advancers after gaining 5.55 per cent, followed by Energy, Insurance, and Consumer Goods with 1.27 per cent, 1.24 per cent, and 0.11 per cent respectively.

There was an uptick in activities as transactions in volume and value terms went up. Investors exchanged 2.63 billion shares worth N26.90 billion, compared to the previous week’s 1.28 billion units valued at N17.34 billion.

Volume was driven by Financial Services, services, and Consumer Goods, particularly FBN Holdings, Sterling Bank, C/I Leasing, Guaranty Trust Holding Company and Transcorp.

Meyer and Consolidated Hallmark were the best-performing stocks during the week after gaining 50 per cent and 25 per cent respectively to N0.33 and N0.55 per share respectively.

On the flip side, Unity Bank and Dangote Cement lost 15.69 per cent and 10 per cent respectively, at N0.43 and N252.00 per share.

In the week ahead, analysts at Cordros Capital expect the bulls to regain dominance in the market given the moderation in the prices of bellwether stocks in the last three weeks. ”

However, we do not rule out the possibility of continued profit-taking activities. In addition, we believe the outcome of the bond auction scheduled to hold during the week will also shape market sentiments. Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings,” Cordros said in its report.

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Local stock market sheds N149bn amidst selloffs of bellwether