Investors Lose N242bn as Equities Market Falls Rapidly
There were riotous selling rallies in the equities segment of the Nigerian Exchange (NGX) in the just concluded week, dragging market capitalisation lower by about N242 billion.
Selloffs in heavyweight shares forced year-to-date returns below 15% despite inflation worries and rising interest rates in the economy. The stock market has seen large exits after interest rate hikes that started in May 2022.
The outlook is a bit scary for the stock market as analysts are projecting further interest rate hikes – which could see risk-averse institutional investors pulling out more fund from equities space.
Forming a pattern, the bears dominated proceedings for 4 of 5 trading days thereby pulling the NGX-ASI down 0.9% week on week to close at 49,026.62 points, according to stockbrokers’ market reports.
Accordingly, year-to-date return moderated to 14.8% from 15.8% while market capitalisation shed ₦241.6 billion to ₦26.4 trillion as of Friday’s close. READ:NGX Returns Negative as Selling Rallies Fuel Losses
Afrinvest said trading activity levels diverged as average volume traded fell 20.3% week on week to 112.6 million units while average value traded rose 18.2% to ₦3.2 billion over the same period.
Still, the Nigerian equities market mirrored the downbeat mood across global stocks, stockbrokers at Cordros Capital stated. The downturn was impacted by losses in BUACEMENT (-10.4%), TOTAL (-10.0%), GUINNESS (-5.6%), GTCO (-4.6%) and SEPLAT (-3.9%) stocks.
BUA Cement lost 10.4% of its market valuation due to investors trading exits on the company’s shares. Also, TOTAL Plc was priced lower by 10% in bear-bull fights that last for days where Bear won for four days. Guinness Nigeria Plc share valuation declined by 5.6% while GTCO lose 4.6% and Seplat Plc tracked lower by 3.9%, thus widened month to date loss to 1.6%
Market analysts said the sectorial performance was broadly negative following losses in the Oil & Gas (-4.7%), Industrial Goods (-3.9%), Insurance (-2.1%), and Consumer Goods (-0.2%) indices. The Banking (+2.1%) index was the sole gainer of the week.
Stockbrokers are envisaging an extension of the cautious trading theme, especially from domestic investors as the market will be focused on the outcome of the MPC meeting scheduled to hold this week to gain further clarity on the movement of yields in the fixed income market.
#Investors Lose N242bn as Equities Market Falls Rapidly#
