Nigerian stocks pare N1.1trn in 7 days as bears take firm grip of market

The Nigerian equities market remained in the red Tuesday, extending the bearish run into the seventh consecutive trading session with loss of N1.051 trillion in market capitalization within the seven-day period.

Market performance on Tuesday saw the NSEASI falling 2.4 percent to settle at 41,708.15 points while year till date return contracted to 9.1 percent. As a result, market capitalization decreased by N369.5 billion to N14.9 trillion.

Sustained sell-offs across board was experienced on the day, with Dangote Cement (-4.9 percent), Nigerian Breweries (-3.9 percent) and Nestle Nigeria (-2.9 percent) being the major drags on performance. Similarly, activity level weakened as volume and value traded fell 9.1 percent and 29.0 percent to 470.5 million units and N3.7 billion respectively.

Performance across sectors was bearish as all indices trended downwards. The consumer goods index was the biggest loser, down 2.8 percent following price depreciation in Nigerian Breweries (-3.9 percent) and Nestle Nigeria (-2.9 percent).

The industrial goods and insurance indices trailed, shedding 1.6 percent and 1.5 percent respectively as investors took profit in Dangote Cement (-4.9 percent), Mansard Insurance (-2.7 percent), and Continental Insurance (-4.3 percent).

In the same vein, sell pressure on Forte Oil (-5.0 percent) and Mobil Nigeria (-0.3 percent) dragged the Oil & Gas index 0.6 percent lower while the Banking index slid 0.2 percent due to losses in United Bank for Africa (-5.5 percent) and Union Bank of Nigeria (-5.0 percent).

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Market breadth (advance/decline ratio), which measures investor sentiment, remained flat at 0.4x consequent on 15 stocks advancing against 40 stocks that declined. The best-performing stocks were AG Leventis (+7.0 percent), Berger Paints (+5.0 percent) and Eterna (+5.0 percent) while Prestige Assurance (-7.1 percent), Skye Bank (-6.5 percent) and Hallmark Insurance (-6.1 percent) were the worst performers.

In the NASD OTC Exchange, total volume and value traded stood at 17,823 units and N2.5 million respectively. The SDFCWAMCO and SDNDEP were the only instruments traded today.

Analysts at Afrinvest Limited did not rule out the possibility of an upswing in performance before the end of the week, saying “our view is buttressed by the fact that the current 14-day RSI stands at 38.8 points, which is closer to the oversold region.”

In their own view, analysts at APT Securities and Investment Limited said, the southward trend remains intact as investors’sentiment lingers.

They advised investors to tread with caution pending a major push factor that will drive the market upward such as year-end earnings release.