Investors’ interest in Nigerian banking and insurance stocks remained strong Monday as both sector indices closed positive, appreciating 0.2 and 0.1 percent respectively. However, market benchmark index, the NSEAI, ended the day negative, closing 0.3 percent lower than previous trading session on profit taking in other sector stocks.
Interest in banking stocks on the day was despite rising concerns over the take-over of Skye Bank last Friday by the regulatory authorities and the eventual suspension in the trading of its shares.
Market analysts had warned on the implications of such regulatory actions, which according to them could lead erosion of investment value and may adversely impact on stocks in the affected sector.
However, at the close of trade on Monday, the first trading session preceding the takeover, investors’ buy interest continued in tier-1 banking stocks like GUARANTY (+1.6%), ZENITH (+1.0%), UBA (+1.3%).
- Motor Insurance market experiences strong growth in 2022
- Imo-Abia MAN gets leader with strong entrepreneurial background
- SEC, IFSB hosts maiden global forum on non-interest capital markets
- Nigeria’s tech ecosystem absent in $117.8bn global HPC market
- NDIC explores ways to strengthen depositors' insurance protections
Lifting the insurance sector by 0.1 percent were NIGERINS (+9.7%), AIICO (+3.7%) and LASACO (+6.5%).
Gains in these stocks were unable to bring the overall benchmark index to a positive close as profit taking in NIGERIAN BREWERIES (-3.2%), UBN (-9.5%) and OKOMUOIL (-9.0%) dragged the benchmark index 0.3 percent lower to close at 32,451.27 points.
As a result, market capitalisation declined by N32.5 billion to N11.8 trillion while year-to-date loss worsened to -15.1 percent.
Similarly, activity level weakened as volume and value traded fell 42.4 percent and 24.9 percent to 190.5 million units and N3.3 billion respectively.
The top traded stocks by volume were GUARANTY (67.0m units), TRANSCORP (15.8m units) and UBA (10.6m units) while GUARANTY (N2.3bn), NIGERIAN BREWERIES (N139.1m) and ZENITH (N123.9m) were the top traded stocks by value.
The oil & gas index declined the most by 0.8 percent, following sell-offs in FORTE (-6.7%) while the industrial and consumer goods indices lost 0.7 percent and 0.6 percent respectively on the back of price depreciation in WAPCO (-2.1%), CAP (-4.1%), NIGERIAN BREWERIES (-3.2%) and GUINNESS (-2.1%).
Investor sentiment as measured by market breadth (advance/decline ratio) weakened to 0.6x from 1.5x recorded last Friday as 13 stocks appreciated compared to 23 stocks that depreciated.
The best performers were NIGERINS (+9.7%), LASACO (+6.5%) and UNILEVER (+4.7%) while LIVESTOCK (-9.5%), UBN (-9.5%) and LAWUNION (-9.1%) declined the most.