Investors Lose N661 billion to Bearish Trade on NGX
Equities investors in the Nigerian stock market lost about N661 billion to bearish trade in the local bourse last week. There were records of selloffs across tickers amidst uncertainties including weakening local currency and rising headline inflation.
Market analysts have projected that the consumer price index will worsen as the National Bureau of Statistics is expected to release the inflation figure for September 2022 this week.
In a market report, analysts at Cowry Assets Management said panic sell-offs and bargain hunting activities drove the market rally further into the bearish zone despite Friday’s positive close.
Stockbrokers said the benchmark index declined by 3.41% week on week and for the fourth consecutive week to 47,351.43 points as the market digested the latest interest rate hike with a chance for portfolio realignment.
Consequently, equities market capitalization declined 2.50% week on week to N25.79 trillion as investors shed down their holdings in some relatively volatile stocks. Overall, the Nigerian Exchange dropped by N660.95 billion while year-to-date return moderated to 10.85% – miles behind Nigeria’s inflation rate. READ: Investors Lose as Bear Returns to Stock Market
Following the lacklustre performance on the back of waning investors’ sentiments, Cowry Asset said in its weekly report that losses were recorded from panic sell-offs witnessed in tickers such NASCON Allied Industries Plc, Cornerstone Insurance Plc, Airtel Africa Plc, Presco and Okomu Oil Plc.
NASCON lost 14% of its market valuation, CORNERST declined by 11% while AIRTELAFRI was priced down by 10% just as PRESCO and Okomu lost 10% of their market prices to selloffs.
On sectorial performance, NGX Banking shed 3.37%, thus leading the losers’ chart, trailed by NGX Insurance which lost 1.16% and NGX Oil/Gas dropped by 1.02%. Also, the NGX Consumer Goods index was down by 0.56% while the NGX Industrial Index fell by 0.33% week on week.
Trading activities inched downward as the total traded volume dished 41.57% week on week to 586.94 million units while the total weekly traded value hollow-shaped by 15.08% week on week to N8.84 billion on Friday.
The total deals traded for the week lagged by 2.67% week on week to 17,183 trades from 17,654 deals in the previous week. Cowry Asset Management traders expect the market to sustain its current trend as investors adopt cautious trading styles at these critical support levels amidst low valuation and liquidity in the market.