Nigeria stocks in red zone on sell pressures as investors book profit after black Tuesday

By Charles Abuede

The Nigerian equity market closed on a negative note midweek due to sell-off by investors as peaceful #EndSARS protests turned violent across the federation with maximum losses recorded in the banking sector. With the weak buying interest from investors, analysts are looking ahead to a negative close for the week.

Sell pressures dominated the day’s trading session as investors booked gains from MTN (-1.4%), Guinness Plc (-5.9%) and ARDOVA (-6.3%). As a result, the All-Share Index declined 75 basis points to 28,449.49 points; market capitalisation fell by N113.1 billion to N14.9 trillion, while the year to date (YTD) return weakened to 6.0 per cent.

Activity level improved as volume and value traded rose by 9.8 per cent and 44.3 per cent to 326.6 million units and N4.2 billion respectively. The most traded stocks by volume were United Bank for Africa (UBA) with 40.3 million units; Zenith Bank, with 39.6 million units; and Guaranty Trust Bank, with 38.3 million units. In terms of value, GTB, with N1.1 billion; Zenith Bank, with N800.9 million and Nestle Plc, with N479.9 million, led the value chart.

Bearish sector performance 

Performance across sectors was lacklustre as all indices lost except for the insurance index (+0.6%), which was buoyed by price appreciation in Wapic Plc (+10.0%). The banking index lost the most, down 1.7 per cent, following losses in GTB (-1.3%) and Zenith Bank (-1.2%). Similarly, the AFR-ICT and oil & gas indices depreciated by 1.1 per cent and 0.3 per cent respectively, due to sell pressures in MTN Nigeria (-1.4%) and ARDOVA (-10.0%). Likewise, profit-taking in Guinness Plc (-5.9%) and Wapco Plc (-4.4%), dragged the consumer and industrial goods indices lower by 0.1 per cent and 0.3 per cent respectively.

Waning investor sentiment

Investor sentiment as measured by market breadth (advance/decline ratio) fell to 0.1x from the 1.4x recorded in the previous session as 4 stocks gained against 34 decliners. WAPIC (+10.0%), Portland Paint (+2.5%) and UAC-Property (+1.3%) gained the most while Royal Express (-8.0%), NEIMETH (-7.6%) and UNIONDAC (-7.1%) led the laggards.

The NSE 30

The NSE 30 index decreased by 0.84 per cent to close at 1,218.60 points as against 1,228.96 points as on the previous day. Market turnover closed with a traded volume of 221.50 million units. Nigerian Breweries was the only gainer, while Ecobank and Guinness were the key losers.