The bearish sentiments at the Nigerian Stock Exchange continued Wednesday as benchmark index, the NSEASI, slid 26bps to 40,749.86 points while YTD return moderated return to 6.6 percent.
Consequently, market capitalisation lost N38.2 billion to close at N14.7 trillion.
Analysts attribute the continuous downturn in the market to profit taking and a general correction in the market after a rally in the first two months of the year.
Wednesday’s performance was particularly defined sell pressures in ZENITH (-8.2%), ETI (-3.8%) and DANGFLOUR (-9.5%). However, contrary to market performance, activity level improved as volume and value traded trended 10.0 percent and 7.9 percent higher to 401.4 million units and N6.8 billion respectively.
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FBNH (70.8m), ZENITH (61.2m) and FIDELITY (43.7m) were the most active stocks by volume while ZENITH (N1.7bn), NESTLE (N1.5bn), and GUARANTY (N992.3mn) led the top traded stocks by value.
Sector performance was mixed as two of five indices under our coverage closed positive. The industrial goods index grew 0.6 percent on account of gains in WAPCO (+1.3%) while the oil & gas index closed in the green, up 0.1 percent due to uptick in FORTE (+2.7%).
On the flip side, the banking index led the losers, down 0.9 percent, as investors booked profit in ZENITH (-8.2%) and ETI (-3.8%). The insurance index trailed losing 0.6 percent, as NEM (-4.9%) and WAPIC (-7.0%) recorded losses. Similarly, price depreciation in DANGFLOUR (-9.5%) and NASCON (-2.3%) dragged the Consumer Goods index 0.3 percent lower.
Investor sentiment measured by market breadth (advance/decline ratio) strengthened, albeit still soft to 0.7x from 0.3x recorded the previous day as 18 stocks advanced against 27 losers. The top performers on the day were LASACO (+5.9%), FIDELITY (+5.8%) and ACCESS (+4.9%) while the laggards were led by DANGFLOUR (-9.5%), MULTIVERSE (-9.1%) and SOVEREIGINS (-9.1%).
Despite the day’s performance analysts were still optimistic of a near term rebound.
“Following two consecutive days of decline, we do not rule out the possibility of a rebound in performance driven by bargain hunting in subsequent trading session,” said analysts at Afrinvest.