The depressed state of Nigerian equities failed to abate Wednesday as benchmark index, the NSEASI, dipped 1.08 percent on domestic investors’ lack of capacity to lift the market in the course of foreign portfolio investors selling off their stakes.
The day’s trading was dominated by bears as continuous sell pressures in bellwethers – NESTLE (-3.8%), DANGCEM (-1.0%) and NIGERIAN BREWERIES (-4.4%) – dragged the NSEASI lower to close at 38,606.41 points while year-to-date YTD return further declined to 0.9%.
As a result, market capitalization pared N152.9 billion to close at N14.0 trillion. Activity level, however, strengthened as volume and value traded rose by 53.9 percent and 188.5 percent to 342.0 million units and N4.7 billion respectively.
The top traded stocks by volume were ACCESS (68.3m), TRANSCORP (42.1m) and ZENITH (35.7m) while the top traded stocks by value were GUARANTY (N1.0bn), ZENITH (N929.6m) and NESTLE (N750.8m).
Performance across sectors was equally bearish as four of five major indices closed in the red.
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The industrial goods index led laggards down 2.7 percent as sell-offs in DANGCEM (1.0%) and WAPCO (-4.9%) dragged the index lower. The consumer goods index followed closely due to losses recorded in NESTLE (-3.8%) and NIGERIAN BREWERIES (-4.4%), which pulled the index 2.6 percent lower while the oil & gas index lost 0.5 percent resulting from profit-taking in OANDO (-0.7%) and JAPAULOIL (-4.6%).
Also, the banking index continued its downtrend, falling 0.3 percent on the back of price depreciation in ZENITH (-1.9%) and ETI (-2.2%). On the flipside, the insurance index gained 1.0 percent, resulting from gains in MANSARD (+4.2%) and WAPIC (+4.2%).
Investor sentiment as measured by market breadth (advance/decline ratio) strengthened to 0.9x from 0.3x as 23 stocks advanced against 25 stocks that declined. HMARKINS (+6.3%), FCMB (+5.0%) and FLOURMILLS (+4.9%) led the gainers chart today while IKEJAHOTEL (-7.0%), AGLEVENT (-6.8%) and GLAXOSMITH (-4.9%) declined the most.
With improved investor sentiment on the back of some bargain hunting in some small caps, market analysts and traders anticipate a positive performance in subsequent sessions during the week this week.
They are of the view that downbeat prices have created an opportunity for bargain-hunting in value stocks, and that the positive macroeconomic fundamentals suggest a likelihood of gains in the medium to long-term.
Frontpage November 6, 2019