Investors’ profit booking sell-offs in Dangote Cement dip Nigeria equities index 0.05%

A raft of investors’ profit booking on Wednesday’s price gains by Nigeria’s most capitalised company, Dangote Cement plc, saw sell-offs of shares in the company that led to a reversal of fortune for the country’s equities index, which went down 0.05 percent at the close of Thursday’s trading.

At the close of trading the Nigerian bourse’s index fell 0.05% to close at 35,188.97 points. Accordingly, the year-to-date YTD market gain settled at 30.9 percent whilst stocks lost N6.5 billion in value as market capitalization settled at N12.1 trillion.

Price loss in DANGCEM (-1.6%) was the major drag on market performance. Specifically, without DANGCEM the market would have gained 0.6 percent.

Activity level spiked as volume and value traded surged 212.5 percent and 665.4 percent to 429.2 million units and N8.7 billion respectively.

Sector performance stayed mixed as two of five indices declined. The oil & gas index led losers, down 0.7 percent on account of profit taking in TOTAL (-2.6%) and OANDO (-2.2%), while DANGCEM (-1.6%) dragged the industrial goods index 0.5 percent lower.

On the flipside, the Consumer Goods index rebounded 1.3% due to gains in NIGERIAN BREWERIES (+2.9%) and GUINNESS (+2.6%) while GUARANTY (+0.7%) and UBN (+1.2%) buoyed the banking index 0.2% higher. Similarly, the insurance index added 0.2 percent due to upticks in NEM (+4.5%) and WAPIC (+2.0%).

Despite the decline in performance, market breadth improved to 1.3x (from 0.9x yesterday) as 25 stocks advanced against 19 decliners.

The best performers were NEIMETH (+4.9%), NEM (+4.5%) and FBNH (+4.3%) while AIICO (-5.4%), CHAMPION (-5.3%) and CAVERTON (-5.0%) were the worst performers.

Analysts attribute today’s negative close to profit taking in DANGCEM and that the positive market breadth suggests a hunt for bargains by investors. They therefore, expect the market to close the week in the green.