Nigerian equities see 5.0% week-on-week loss as investors hedge on falling oil prices

The Nigerian equities market extended its two-day loss to close Friday June 23, 2017 with a week-on-week negative position of 4.99 percent due to falling oil prices nearing the budget benchmark of $44.5 percent, according to analysts.

“Brent crude price fell to about $44.82 on Thursday, uncomfortably close to the $44.5 percent budget benchmark,” an analyst told Businessamlive.

“Nigeria’s recent external reserve position is also thought to have spooked some investors. Our reserves have fallen from about $30.9 billion in May 2017 to just above $30.2 billion as at June 21, 2017. A further drop in the external reserve position could trigger another round of depreciation of the naira,” analysts at Trust Yield investment said.

Others say the signing of the budget and expectations of release of funds may have influenced investors to tarry and see where to invest their money in the various capital projects outlined in the budget.

The bourse’s all-share index depreciated by 2.45% to close at 32,122.14 basis points, as against 1.64% depreciation recorded previously. The market year-to-date (YTD) returns currently stands at 19.53%.

Market turnover equally closed negative as volume moved down by 18.09% against 0.20% uptick recorded in the previous session. TRANSCORP, ACCESS and FBNH were the most active to boost market turnover with ZENITHBANK and ACCESS topping the market value list.

The current week performance is the worst since May 12, 2017. The bearish sentiment in the bourse in the last three sessions, according to
analysts, is partly attributable to slide in oil prices since the start of the week.

A total turnover of 2.311 billion shares worth N24.577 billion in 27,836 deals were traded this week by investors on the floor of the Exchange in contrast to a total of 2.737 billion shares valued atN32.042 billion that exchanged hands last week in 32,217 deals.

The financial services industry (measured by volume) led the activity chart with 1.783 billion shares valued at N15.865 billion traded in
15,948 deals; thus contributing 77.17% and 64.55% to the total equity turnover volume and value respectively.

The conglomerates industry followed with 239.226 million shares worth N571.910 million in 1,251 deals. With consumer industry coming third.

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Trading in the top three equities namely – Zenith International Bank Plc, Transnational Corporation of Nigeria Plc and FBN Holdings Plc
(measured by volume) accounted for 665.483 million shares worth N6.695 billion in 5,649 deals.

While, the bourse closed negative as CHAMPION led 21 Gainers against 33 Losers topped by UBA at the end of the day’s session- an unimproved performance when compared with previous outlook.

MCNICHOLS leads the list of active stocks that recorded impressive volume spike at the end of today’s session.