NGX sheds N544bn as banking stocks drag market lower

The Nigerian equities market extended its bearish run on Tuesday as renewed sell-offs in banking stocks dragged the benchmark index lower, wiping N544.48 billion from investors’ wealth.

The Nigerian Exchange All-Share Index declined by 0.35 per cent to close at 241,611.23 points, moderating its year-to-date return to 55.26 per cent.

Consequently, market capitalisation fell to N155.97 trillion, reflecting continued weakness in investor sentiment.

Market breadth remained bearish at 0.61x, with 36 stocks recording losses against 22 gainers.

The major gainers were Haldane McCall, Veritas Capital Assurance, Tantalizer, R. T. Briscoe and Regal Insurance, while Red Star Express, Transnational Express, Meyer, Chellarams and Fortis Global Insurance led the decliners.

Sectoral performance was largely negative, with the banking sector recording the biggest decline of 1.82 per cent. The consumer goods and oil and gas sectors also closed lower by 0.03 per cent and 0.01 per cent respectively.

The insurance sector, however, gained marginally by 0.04 per cent, while the industrial goods and commodities sectors closed flat.

Despite the decline in the benchmark index, transaction value increased significantly by 19.86 per cent to N27.48 billion, indicating higher monetary activity during the session.

However, trading volume plunged by 67.69 per cent to 429.84 million shares, while the number of deals declined by 21.57 per cent to 35,683 transactions.

The divergence between transaction value and volume suggests that trading was concentrated in relatively higher-value transactions despite the broader decline in market activity.

Analysts expect the equities market to gradually regain bullish momentum as investor sentiment improves. However, persistent profit-taking could limit the pace of recovery and sustain volatility in the near term.

The latest decline comes after the market’s strong rally earlier in the year, with the All-Share Index still delivering a year-to-date gain of 55.26 per cent.

Investors are therefore expected to remain cautious as they balance opportunities for further gains against the risk of profit-taking following the market’s substantial year-to-date appreciation.