Equity investors on the Nigerian Exchange Ltd. (NGX) experienced a significant loss of N1.32 trillion in the just concluded week.
The downward performance was driven by selloffs in Tier-one banking stocks, namely: Zenith Bank, Guaranty Trust Holding Company (GTCO), and also Dangote Cement, Dangote Sugar, and African Prudential, among others.
Specifically, investors reacted negatively to the Central Bank of Nigeria’s (CBN’s) hike in the Monetary Policy Rate (MPR) announced within the week.
CBN’s Monetary Policy Committee (MPC) on Tuesday announced another increase in the country’s MPR by 50 basis points to 26.75 per cent, from 26.25 per cent.
Yemi Cardoso, CBN governor, said the decision was in response to the continued inflationary pressures.
He noted that it was important to deal with inflation, as the apex bank was concerned over the impact of the inflation on ordinary Nigerians and businesses.
The NGX) All-Share Index and Market Capitalization depreciated by 2.33 per cent each to close the week at 98,201.49 and N55.605 trillion, respectively, against 100,539.40 and N56.929 trillion posted in the previous week.
Similarly, all other indices finished lower with the exception of the NGX MERI Value, which appreciated by 0.72 per cent while the NGX ASeM and NGX Sovereign Bond indices closed flat.
Also, 20 equities appreciated in price during the week, lower than 37 equities in the previous week.
Forty-seven equities depreciated in price, higher than 34 in the previous week, while 84 equities remained unchanged, higher than 80 recorded in the previous week.
Secure Electronic Technology Plc led 46 declined equities on the losers’ table by 26.32 per cent to close at 42k per share.
Sovereign Trust Insurance Plc led 19 other advanced equities on the gainers table by 14.29 per cent to close at 56k per share.
Meanwhile, a total turnover of 3.557 billion shares worth N47.220 billion in 42,871 deals was traded during the week by investors.
This is in contrast to a total of 2.827 billion shares valued at N42.366 billion that exchanged hands last week in 44,277 deals.
The financial services industry, measured by volume, led the activity chart with 2.011 billion shares valued at N25.783 billion traded in 24,350 deals.
This contributed 56.52 per cent and 54.60 per cent to the total equity turnover volume and value, respectively.
The services industry followed with 1.020 billion shares worth N3.216 billion in 1,846 deals.
The agriculture industry took third place, with a turnover of 168.028 million shares worth N647.859 million in 1,473 deals.
Trading in the top three equities, namely: Tourist Company of Nigeria Plc, FCMB Group Plc and Abbey Mortgage Bank Plc measured by volume, accounted for 1.876 billion shares worth N8.511 billion in 935 deals.
This contributed 52.73 and 18.02 per cent to the total equity turnover volume and value, respectively.
Looking ahead to the coming week, analysts at Cowry Asset Management Ltd. predicted that the bearish trend is expected to persist.
The analysts said this is because market players would continue to digest the outcome of the recently published economic data and the interest rate hike by the apex bank.
They noted that the continued rise in yield levels within the fixed income and money market spaces is likely to maintain the unattractiveness of equities as investors opt for the appealing yields.
“Nonetheless, a mildly positive performance is anticipated on the back of continued earnings releases and attractive dividend declarations by corporations in the coming week.
“As the market structure and fundamentals evolve, investors are advised to position themselves in stocks with sound fundamentals to navigate the prevailing conditions effectively,” the analysts stated.
(NAN)
