Nigerian Stock Market Faces a Reversal as High-Quality Tickers Trigger Profit-Taking

The Nigerian stock market encountered a sudden reversal as the equity section of the Nigerian Exchange (NGX) lost more than N883 billion midweek. This marked a significant setback compared to the strong performance witnessed previously.

Investors decided to take early profits on select high-quality tickers, triggering the market decline. Prominent companies like FBNH, Dangote Cement, and Nestle Nigeria experienced selling rallies, resulting in a sharp reversal of the prior upward trend.

According to market experts and stockbrokers, the Nigerian Exchange All-share index plummeted by 247 basis points to 64,046.93 points. This was in stark contrast to its robust performance on Tuesday, reaching 65,669.29 points. The withdrawal of investors from 63 stocks played a vital role in the market downturn.

Among the stocks closely monitored, DANGCEM witnessed a 9.63% decline in price despite its share repurchase program. FBNH, amid a shareholder controversy, experienced a significant 10% drop. NESTLE, a fallen angel in the FMCG sector, aimed to rejoin the N1 trillion club but faced a decline of 1.34%. Meanwhile, DANGSUGAR fell by 1.27%, and ACCESSCORP saw a 4.16% reduction in its open market valuation.

As a result of this substantial market loss, the year-to-date return decreased to 24.97%, aligning with the drop in market capitalization. Investors faced a staggering loss of N883.39 billion due to the prevailing financial environment.

The negative market sentiment experienced on that day was reflected in the increased market activity. A total of 1.16 billion units worth N12.69 billion were traded, representing a 37.7% rise in total volume.

Based on volume, UBA was the most traded stock, accounting for 15.30% of the total volume of trades. It was followed by JAPAULGOLD (9.49%), TRANSCORP (7.50%), FCMB (7.44%), and ACCESSCORP (5.63%) to complete the volume chart's top 5.

In terms of value, UBA remained the most traded stock, representing 19.25% of the total value of trades on the Nigerian stock exchange.

The performance across sectors was broadly bearish, with losses observed in the Insurance (-5.4%), Industrial Goods (-5.4%), Banking (-2.6%), Consumer Goods (-0.8%), and Oil & Gas (-0.5%) indices. Market breadth, measured in terms of the number of gainers and losers, was negative (0.2x), as 63 tickers closed lower compared to only 11 gainers.

The most significant losses of the day were recorded by VERITASKAP (-10.0%) and ACADEMY (-10.0%). However, DEAPCAP experienced a 10.0% increase, and COURTVILLE soared by 10.0%, leading the gainers' chart. Additionally, 47 stocks closed flat, indicating minimal change in their prices.

Overall, the Nigerian stock market witnessed a market capitalization loss of ₦883.39 billion, accounting for a -2.47% decrease. The market closed at ₦34,874.19 trillion compared to the previous day's value of ₦35,757.58 trillion.

Source of content: OOO News 2023-07-13 News

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