Onome Amuge

Nigeria’s stock market ended the week on a muted note, slipping into negative territory on Friday despite strong breadth and upbeat trading activity. The Nigerian Exchange All-Share Index (NGX ASI) fell 0.09 per cent to 140,545.69 points, cutting year-to-date gains to 36.55 per cent. Market capitalisation shed N81.44 billion, closing at N88.92 trillion.

The day’s  decline belied a generally optimistic tone across the market, where 31 stocks advanced compared with 20 that fell. Yet investors’ attention was drawn to Mutual Benefit Assurance Plc and Lasaco Assurance Plc, two of the session’s highest decliners, as both insurers faced heavy selling pressure.

The insurance index, down 0.62 per cent, was the only financial subsector to close in the red, dragged primarily by losses in Mutual Benefit and Lasaco. Mutual Benefit shares slid 7.8 per cent to N3.90, wiping out gains accumulated earlier in the week. Lasaco, meanwhile, fell 5.97 per cent to N2.99.

Analysts say the moves reflect a mix of profit-taking and lingering investor unease over the earnings outlook for insurers. Insurers, traditionally thinly traded compared to banks or industrial giants, have seen their stocks rise in recent months as investors hunted for bargains. That momentum appears to be fading as the broader market reassesses valuations amid macroeconomic uncertainty.

Adding to Friday’s losers, DAAR Communications Plc, the media group behind Africa Independent Television, dropped 4.5 per cent to close at N1.06. The stock has struggled to attract fresh inflows, reflecting both competitive industry pressures and investor preference for more liquid, dividend-paying equities.

Still, Mutual Benefit and Lasaco’s declines stood out for their scale and impact on sector performance, underscoring the fragility of market confidence in insurance counters.

Despite the headline decline, trading activity rose. Deal counts climbed 3.46 per cent to 23,729, while trading volume climbed nearly 15 per cent to 334.73 million units. Value turnover jumped 30.29 per cent to N16.17 billion.

Secure Electronic Technology topped the volume chart, exchanging 71 million shares across 331 deals. Access Holdings and Sterling Bank followed with 40 million and 37 million shares respectively. On the value side, Aradel Holdings led with N8.7 billion traded, while Access and Zenith Bank both cleared trades worth over N1 billion.

Gains in banking (+0.97 per cent), oil & gas (+0.98 per cent), and commodities (+0.49 per cent) were insufficient to offset losses in insurance, consumer goods (-0.13 per cent), and industrials (-1.39 per cent).

The industrial sector was pressured by declines in large caps, including PZ Cussons and NGX Group, both of which also made the day’s laggard list.

Meanwhile, gainers were led by Regal Insurance (+9.93 per cent), ETranzact (+9.93 per cent), and Chellaram (+9.92 per cent). Investors appeared willing to chase upside in select small- and mid-cap counters even as they booked profits in others.

The pullback in equities comes against a cautiously improving macroeconomic backdrop. Fresh data released this week showed Nigeria’s trade surplus widened to N7.46 trillion in the second quarter, buoyed by strong non-oil exports. Total trade value rose 20 per cent year-on-year, highlighting gradual diversification away from crude oil dependence.

But challenges remain. Currency volatility, elevated inflation, and patchy policy execution continue to weigh on investor sentiment. For insurers in particular, inflation-driven claims and asset-liability mismatches are squeezing profitability, raising questions about medium-term sustainability.

Market watchers believe Friday’s losses are unlikely to herald a sustained downturn. With breadth positive and liquidity strong, the NGX remains in a broadly bullish trend. However, pressure on insurance counters could persist until earnings clarity improves.

For now, the spotlight remains firmly on the insurers, where Friday’s sell-off has reintroduced caution. Analysts stated that Mutual Benefit and Lasaco may yet bounce back if investors perceive the declines as excessive, but the underlying fragility of the sector remains a risk factor for the broader market.