Investors’ move for profit in banking bellwethers, NB, sustains bearish sentiment in Nigeria equities market

Nigeria equities market maintained its negative trend Thursday as the bourse’s benchmark index shed 35 basis points to close at 35,504.62 points, while year-to-date gain contracted to 32.1 percent.

Sustained profit-taking in NIGERIAN BREWERIES (-2.2%), STANBIC (-4.3%), GUARANTY (-0.3%) and UBA (-3.7%) largely influenced market performance.

The negative trend saw market capitalization decreased by N42.9 billion to close at N12.2 trillion. However, activity level improved as volume and value traded rose 11.1 percent and 37.7 percent to 266.5 million units and N4.0 billion respectively.

Performance across sectors was mixed as three of five indices trended upwards.

The insurance index gained the most, up 1.4 percent on account of price appreciation in CONTINSURE (+5.0%) and MANSARD (+2.6%), followed by the oil & gas index, which added 0.9 percent as a result of upward price movement in TOTAL (+0.8%).

Similarly, appreciation in DANGCEM (+0.2%) buoyed the industrial goods index by 0.1 percent. Conversely, the consumer goods index dipped 1.0 percent owing to a decline in NIGERIAN BREWERIES (-2.2%).

In the same vein, the banking index closed lower, sliding 0.2 percent as a result of losses in STANBIC (-4.3%), GUARANTY (-0.3%) and UBA (-3.7%).

Investor sentiment also strengthened Thursday as market breadth improved to 1.3x (from 0.2x yesterday) after 26 stock advanced against 20 declining stocks.

CONTINSURE (+5.0%), NPFMCRFBK (+4.5%) and FIDSON (+4.4%) topped the gainers’ chart, while JBERGER (-5.0%), CADBURY (-5.0%) and SCOA (-5.0%) led laggards.

The day’s market performance was against analysts’ call that bargain hunting would move the market from the negative territory.

However, most of the analysts are still optimistic that the market would be buoyed in the coming weeks by sustained bargain hunting by investors who would seize the opportunity to invest in stocks that have lost value in recent weeks.

“Following the evident improvement in investor sentiment, we expect market performance in the coming week to be buoyed by sustained bargain hunting by investors,” analysts at Afrinvest noted.