Market Cap of Nigerian Exchange Shrinks as Investors Dump More Shares
The equities market capitalisation of the Nigerian Exchange (NGX) dipped strongly as sell side traders took over trading activities in the local bourse.
Investors sold more shares in the equities market last week. However, the negative effects of selloffs was reduce by rights issues listed by International Breweries.
Stockbrokers said investors offloaded shares across some mid and large-cap listed companies, which dragged the benchmark index lower.
However, the sell side pressure had lower impacts on market capitalisation because International Breweries listed shares worth N516.2 billion on the exchange during the week.
This trend unfolded as market participants continue to react to the positive outcome of the last treasury bills and FGN bonds auctions which recorded healthy investors’ subscription, said Cowry Asset in its market update.
NGX All-Share Index (ASI) fell by 1.16% on a week-on-week basis, closing at 95,973.45 points. Stock analysts said the decline was primarily driven by pressured sell-offs in the consumer goods and industrial goods sectors.
Trading activities throughout the week were notably mixed, with a lacklustre market sentiment prevailing. The weekly traded volume advanced by 183.6% week-on-week to 5.64 billion units, while the weekly traded value declined by 17.78% to N33.05 billion and then the number of weekly deals fell by 4.60%, amounting to 4,993 trades.
This downturn was exacerbated by portfolio realignment in the face of positive market breadth, as evidenced by the fact that the number of gainers (43) was outstripped by the number of losers (36), Cowry Asset Limited said.
In terms of sectoral performance, the firm said the picture was largely positive, with the exception of the industrial goods and consumer goods sectors, which retreated by 4.94% and 1.42% week-on-week respectively.
The pullbacks in the equities market provided strong buying opportunities that buoyed investor sentiment, according to Cowry Asset Limited. Stockbrokers added that this positive sentiment was reflected in the performance of certain stocks, leading to gains in the oil & gas (3.54%), insurance (1.90%), and banking (0.37%) indexes.
As the week drew to a close, specific stocks stood out as top gainers. RTBRISCOE led the chart with a 59% increase, followed by TANTALIZER (55%), OANDO (34%), DEAPCAP (30%), and UCAP (27%), all benefiting from positive price movements during the week.
Conversely, stocks such as CUTIX (-37%), DANGCEMENT (-10%), TIP (-10%), THOMASWY (-10%), and BETAGLASS (- 19%) were among the top losers, primarily due to sell-offs by investors.
The NGX index’s current position below the T-line, along with the 50-day Exponential Moving
Stock experts at Cowry Asset Limited told investors in an email that transaction volume patterns and support levels are signalling further buying opportunities, even as market participants look ahead to the forthcoming release of the Q2 2024 GDP report, along with audited half-year earnings and interim dividend declarations.
Cowry Research anticipates a mixed performance in the new week, driven by ongoing portfolio rebalancing and profit-taking activities.
Overall, the market capitalisation went down to N55.13 trillion, with a total of N2.45 billion being wiped off from the market. As a result, the year-to-date return for the market now stands at 28.35%. #Market Cap of Nigerian Exchange Shrinks as Investors Dump More Shares
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