The Nigerian Exchange’s (NGX) equity market lost N1.4 trillion as investors shifted their wagers to the fixed income market. By repricing Treasury bill spot rates to a seven-year high of 19%, the monetary policy authority narrowed the difference between inflation and investment return.
The local stock exchange closed lower for four of the five days it was open, which resulted in a decrease in investor wealth and a year-to-date return of less than 37%. According to a report from Cowry Asset Limited, the negative shift was the first decline in 16 weeks and was driven by sell sentiment, especially from institutional investors.
The investment banking business claims that portfolio rebalancing for safety appears to be the driving force behind this change in mood. In 2024, the local exchange has significantly increased amidst renewed hope agenda of the government.
Data from the NGX showed that the benchmark index plummeted by a substantial 2.45% week-on-week to 101,858.37 index points, as profit-taking activities dominated the market amidst weak breadth and elevated volatility.
On Friday’s close, the stock market year-to-date return settled at 36.22% following recent delisting of GlaxoSmithKline’s shares from the daily official list of the NGX.
This resulted in a total of N1.42 trillion being wiped off the market as investor sentiment waned across the board, Cowry Asset Limited stated in its market update. The level of trading activity this week was in lacklustre as investors’ sentiment levels reflected negative market breadth, stockbrokers said in separate notes.
As a result, the weekly total traded volume decreased by 36.34% week on week to 2.48 billion units, with the number of trades nosediving by 20.45% week on week to 54,982 deals.
The weekly traded value plunged by 49.70% to N47.86 billion. On the sectoral front, performance was negative as all five sectors declined sharply. The Banking and Industrial indexes led the losses, declining by 6.86% and 4.16%, respectively.
This was primarily driven by price drops in key stocks such as FBNH, GTCO, ZENITH, WAPCO, and JULIUS BERGER. Following closely were the Insurance, Oil & Gas, and Consumer Goods indexes, recording gains of 1.48%, 0.40%, and 0.14% week-on-week losses, driven by negative price movements and sell interest in SUNUASSUR, NB, FLOURMILL, OANDO, ETERNA, AIICO, and MTNN.
Top-performing stocks at the close of the week included MEYER (+61%), JULI (+44%), GEREGU (+19%), MRS (+7%), and BUAFOODS (+4%). On the flip side, stocks like ETERNA (-19%), ABBEYBDS (-18%), MBENEFIT (-18%), STERLINGNG (-16%), and FIDELITY (-15%) experienced declines in their share prices, respectively.
