Nigerian Exchange Loses N1.4trn as GSK Delists
The equities segment of the Nigerian Exchange (NGX) shed N1.4 trillion as investors took bets to the fixed income market. The monetary policy authority repriced spot rates on Treasury bills to 7 7-year high of 19%, reducing the gap between investment return and inflation rate.
For four days out of five, the local bourse ended in red, causing investors’ wealth to decline, and year to date return falling below 37%. The bearish turn happened to be the first downturn in 16 weeks, propelled by sell sentiments, particularly from institutional investors, Cowry Asset Limited said in a note.
According to the investment banking firm, the motive behind this shift in sentiment appears to be portfolio rebalancing for safety. The local exchange has gained strongly in 2024 amidst renewed hope agenda of the government.
Data from the NGX showed that the benchmark index plummeted by a substantial 2.45% week-on-week to 101,858.37 index points, as profit-taking activities dominated the market amidst weak breadth and elevated volatility.
On Friday’s close, the stock market year-to-date return settled at 36.22% following recent delisting of GlaxoSmithKline’s shares from the daily official list of the NGX.
This resulted in a total of N1.42 trillion being wiped off the market as investor sentiment waned across the board, Cowry Asset Limited stated in its market update. The level of trading activity this week was in lacklustre as investors’ sentiment levels reflected negative market breadth, stockbrokers said in separate notes.
As a result, the weekly total traded volume decreased by 36.34% week on week to 2.48 billion units, with the number of trades nosediving by 20.45% week on week to 54,982 deals.
The weekly traded value plunged by 49.70% to N47.86 billion. On the sectoral front, performance was negative as all five sectors declined sharply. The Banking and Industrial indexes led the losses, declining by 6.86% and 4.16%, respectively.
This was primarily driven by price drops in key stocks such as FBNH, GTCO, ZENITH, WAPCO, and JULIUS BERGER. Following closely were the Insurance, Oil & Gas, and Consumer Goods indexes, recording gains of 1.48%, 0.40%, and 0.14% week-on-week losses, driven by negative price movements and sell interest in SUNUASSUR, NB, FLOURMILL, OANDO, ETERNA, AIICO, and MTNN.
Top-performing stocks at the close of the week included MEYER (+61%), JULI (+44%), GEREGU (+19%), MRS (+7%), and BUAFOODS (+4%). On the flip side, stocks like ETERNA (-19%), ABBEYBDS (-18%), MBENEFIT (-18%), STERLINGNG (-16%), and FIDELITY (-15%) experienced declines in their share prices, respectively. #Nigerian Exchange Loses N1.4trn as GSK Delists#
Treasury Rates- Income Hunters Take Bets to Debt Market
