NGX posts second weekly loss on cautious trading

At the Nigerian Exchange Limited (NGX), bearish sentiments persisted for the second consecutive week, as investors booked profits on bellwether stocks.

Cautious trading dominated the local bourse this week as investors await the release of second-quarter earnings.

Accordingly, the All-Share Index (ASI) shed 0.1 per cent Wee-on-Week (WoW) to close at 37,947.18 basis points.

Consequently, Month-to-Date (MtD) and Year-to-Date (YtD) returns moderated to 0.1 per cent and -5.8 per cent, respectively.

Equities investors, over the five-day trading activities, lost N24 billion for their investment as the market capitalisation settled at N19.77 trillion, last Friday.

Last week, sell-offs in bellwether stocks such as Nigerian Breweries, Dangote Sugar, Zenith Bank and BUA Cementndrove the weekly loss as they recorded 3.3 per cent, 2.2 per cent, 2.0 per cent and 0.7 per cent, respectively.

Sectoral performance was broadly negative as the Insurance index led the losers’ chart, followed by the Consumer Goods and Industrial Goods indices. On the other hand, the Oil and Gas and Banking indices closed in green.

Activity levels were weak, as trading volume and value declined by 25.2 per cent WoW and 10.0 per cent WoW, respectively.

Analysis indicated that a total turnover of 1.008 billion shares worth N10.923 billion in 17,297 deals were traded by investors on the floor of the Exchange during the week under review.

The Financial Services Industry led the activity chart with 732.418 million shares valued at N7.213 billion traded in 9,131 deals; thus contributing 72.62 per cent and 66.04 per cent to the total equity turnover volume and value respectively.

The Conglomerates Industry followed with 52.931 million shares worth N170.271 million in 656 deals. The third place was ICT Industry, with a turnover of 52.716 million shares worth N1.806 billion in 701 deals.

Guaranty Trust Holding Company Plc, United Bank for Africa Plc and Zenith Bank Plc were the top equities traded over the week. They accounted for 261.741 million shares worth N5.813 billion in 3,498 deals, contributing 25.95 per cent and 53.22 per cent to the total equity turnover volume and value respectively.

Analysts believed the outcome of the bond auction scheduled to hold this week would shape market sentiments, therefore expecting investors to trade cautiously while taking positions in stocks with attractive dividend yields ahead of H1-21 dividend declarations, which intermittent profit-taking activities would match.

“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 analysts said.

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NGX posts second weekly loss on cautious trading


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