Nigerian equities pare gains as NSEASI closes 0.54% lower on continued sell-offs in large caps

The Nigerian equities market index, the NSEASI, closed 0.54 percent lower Wednesday to 42,839.49 points on continued price depreciation in some large caps – ZENITH (-1.8%), NESTLE (-1.4%), and DANGSUGAR (-4.9%).

Accordingly, market capitalization declined N83.7 billion to close at N15.3 trillion just as market year-to-date gain moderated to 12.1 percent.

The day’s activity level was mixed as volume traded fell 8.6 percent to 372.7 million units while value traded trended 11.9 percent northwards to N6.8 billion.

The top traded stocks by volume were FIDELITY (45.8m), ZENITH (36.3m), and FBNH (34.1m) while the top traded stocks by value were NIGERIAN BREWERIES (N2.4bn), GUARANTY (N1.1bn), and ZENITH (N1.1bn).

The sectorial performance was mixed as three of the five major indices closed southwards with the banking index leading the laggards, down 1.5% due to losses in ZENITH (-1.8%) and ACCESS (-3.5%).

Relatedly, GUARANTY released its FY:2017 earnings result on the day with gross earnings inching 1.1 percent higher to N419.2 billion (from N414.6bn in FY:2016) while profit after tax (PAT) rose 28.9 percent to N170.5 billion. To this end, a dividend of N2.40 (dividend yield of 5.1%) was declared for the period.

The consumer goods index trailed, losing 0.8 percent on account of price depreciation in NESTLE (-1.4%) and DANGSUGAR (-4.9%), while the oil & gas index closed down 0.3 percent as losses in TOTAL (-1.2%) dragged the index lower.

The insurance and industrial goods indices were the only gainers, up 10bps apiece on account of gains in NEM (+4.9%), MANSARD (+1.1%), and DANGCEM (+0.2%).

Investor sentiment as measured by market breadth (advance/decline ratio) dampened further to 0.4x from 0.7x recorded previously consequent on 15 stocks advancing against 40 decliners.

The top gainers on the day were C&I LEASING (+7.8%), UACN PROP (+5.0%), and LIVESTOCK (+5.0%) while LASACO (-9.5%), JAPAUL OIL (-9.1%), and DIAMOND (-7.3%) led the laggards.

“Going forward, we anticipate a rebound in market performance in subsequent trading sessions as investors continue to look for bargain opportunities in previous decliners,” said analysts at Afrinvest