By Julius Alagbe
Investors’ wealth slide N291.5 billion to close at N11.6 trillion last week as bear overrun the market. The bearish trend caved in market index as all share index went down by 2.4% week on week. Market performance wane within the trading week despite positive earnings releases of some listed companies.
Analysts observed that profit taking and sell pressures persisted across most trading sessions as the benchmark index posted losses on 4 of the 5 trading days. Consequently, the ASI declined 2.4% W-o-W to settle at 31,142.72 points and year to date (YTD) return worsened to -0.9%, while market capitalisation shed N291.5 billion to close at N11.6 trillion.
Similarly, trading activity weakened as average volume and value traded fell 13.7% and 2.9% W-o-W to 222.2 million units and N2.7 billion respectively. The top traded stocks by volume were FBNH (169.9 million units), ZENITH (163.1 million units) and DIAMONDBK (131.2 million units) while ZENITH (N3.7 billion), FBNH (N1.4 billion) and NESTLE (N1.3 billion) topped trades by value.
Trading activities for the week started off on a negative note on Monday as the ASI dipped 0.9% due to profit taking in ZENITH, NESTLE and STERLING. On Tuesday, sell-offs in GUARANTY, INTBREW and DANGCEM led to a further loss of 1.0% for the ASI. However, by Wednesday, bargain hunting in NESTLE and GUARANTY upturned market performance and the benchmark index gained 0.2%.
Nonetheless, bearish sentiments returned to the domestic bourse as the ASI declined 0.5% and 0.2% on Thursday and Friday respectively following sell-offs in the stocks that appreciated earlier in the week.
Performance across sectors was largely bearish as 4 of 5 indices under Afrinvest’ analysts coverage declined W-o-W. The Oil & Gas index emerged the lone gainer, up 0.1% W-o-W due to sustained buying interest in OANDO (+2.6%).
On the flip side, the Banking index declined the most, down 6.1% W-o-W due to sell pressures in GUARANTY (-5.1%) and ZENITH(-11.8%) while the Industrial index trailed, down 1.1% W-o-W due to price depreciation in DANGCEM (-2.6%). Similarly, the Insurance and Consumer Goods indices shed 0.8% and 0.4% W-o-W respectively due to sell-offs in CORNEST (-8.7%), GUINNESS (-1.4%) and INTBREW (-10.9%).
Investor sentiment as measured by market breadth (advance/decline ratio) weakened to 0.4x from 0.6x in the previous week, as 16 stocks appreciated compared with 43 stocks that declined. The best performing stocks were CAP (+10.0%), ROYALEX (+9.4%) and CADBURY (+9.1%) while AFRIPRUD (-20.8%), FCMB (-12.7%) and ZENITH (-11.8%) underperformed.
“Consequent on the losses recorded on four trading sessions during the week, we expect to see some bargain hunting in early trades next week, supported by positive earnings release on some counters. Nonetheless, given the paucity of foreign portfolio participation in the local bourse, we anticipate that the lingering bearish sentiments would drive a negative close”, Afrinvest said.
By Julius Alagbe