NGX dips 0.32% as bank recapitalisation fears weigh on sentiment
April 3, 2024598 views0 comments
The All-Share Index, the benchmark index for the Nigerian stock market, extended its decline from the Easter break, falling another 0.32% to close at 104,181.32 points. The latest decline was attributed to the underperformance of the most capitalized stocks on the exchange, known as the SWOOTs.
The selloffs of GTCO (-1.23%), ZENITHBANK (-1.23%), and FBNH (-5.02%) pulled the market lower, despite the positive performance of Dangote Sugar Refinery (+1.35%), Flour Mills Nigeria (+0.64%), and Dangote Cement Plc (+0.08%). The net effect was a decline in the YTD return to 39.33 per cent, and a corresponding drop in market capitalisation to N58.91trn.
According to analysts, the second straight day of market declines was driven by investors’ reaction to the central bank’s plans to recapitalize banks. While most bank stocks were able to maintain modest gains on Tuesday, they mostly fell on Wednesday as investors continued to consider the implications of the central bank’s plan.
Compared to the previous session, Wednesday’s market activity saw a significant decline in value of transactions, down by 39.04 per cent. A total of 405.03m shares were traded in 10,364 deals, for a total value of N8.91bn. The largest volume of shares traded was in Access Corporation (-4.20%), with 50.00m shares, while the largest value of shares traded was in Zenith Bank Plc (-1.23%), at N1.86bn.
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Market breadth, which measures the number of advancing and declining stocks, closed at a negative 0.63-to-1 ratio, indicating a bearish market. Specifically, 31 out of 50 stocks declined, while 19 out of 50 stocks advanced.
Universal Press Plc (UPL) was the top-performing stock on the exchange, as its share price increased by 9.84%. Meanwhile, Intensiv Healthcare Plc (INTENEGINS) and Caverton Offshore Support Group Plc (CAVERTON) were the worst-performing stocks, with their shares falling 10% each.
In terms of volume, Access Corporation Plc (ACCESSCORP) saw the highest trading activity, with the largest number of shares traded. Meanwhile, Zenith Bank Plc (ZENITHBANK) had the highest monetary value of shares traded.