Sell-offs in the stock market in the past week led to five days of consecutive losses for investors. At the end of the week, investors saw about N1.22tn shaved off their wealth.
Analysts pinned the sell-offs in the market on portfolio balancing activities of investors who offloaded some shares like newcomer, Aradel which dipped by 25.75 per cent week-on-week, and BUA Cement whose value dipped by 11.09 per cent compared to the previous week.
Also, researchers at Cowry Assets Management Limited blamed the negative trading pattern on cautious trading behaviour as investors grappled with economic uncertainties.
They also attributed it to the latest macroeconomic data releases such as the data on internally generated revenue across its 36 states and the Federal Capital Territory for 2023 released by the National Bureau of Statistics.
To close the week, the All-Share Index took a sharp 2.03 per cent week-on-week haircut, closing at 97,432.02 points. The market capitalisation dropped by 2.03 per cent week-on-week to settle at N59.04tn, wiping out N1.22tn in gains from prior weeks. As a result, the year-to-date return of the index settled at 30.30 per cent.
In terms of trading activities, a total turnover of 2.717 billion shares worth N54.632bn were traded in 46,848 deals compared to 2.142 billion shares valued at N85.946bn that exchanged hands last week in 41,217 deals.
The Financial Services Industry (measured by volume) led the activity chart with 1.821 billion shares valued at N28.958bn traded in 20,173 deals; thus contributing 67.01 per cent and 53.01 per cent to the total equity turnover volume and value, respectively.
The ICT Industry followed with 389.848 million shares worth N6.560bn in 2,515 deals. Third place was the Conglomerates Industry, with a turnover of 160.993 million shares worth N4.746bn in 3,623 deals.
The top three equities measured by volume include Fidelity Bank Plc, Chams Holding Company Plc and United Bank for Africa Plc which accounted for 1.225 billion shares worth N17.721bn exchanged in 4,912 deals, contributing 45.10 per cent and 32.44 per cent to the total equity turnover volume and value, respectively.
Sectoral performance over the week reflected widespread losses. The NGX-Industrial Goods sector was notably impacted, declining by 3.70 per cent week-on-week, driven by significant drops in stocks like BUA Cement, UPDC, and Caverton.
Both the Consumer Goods and Insurance sectors also recorded declines, with losses of 0.22 per cent and 0.40 per cent, respectively, as stocks such as Regency Alliance Insurance, Royal Exchange, Cadbury, Honeywell Flour and McNichols, saw reduced trading activity and price depreciation.
In contrast, the NGX-Oil & Gas sector emerged as the primary gainer, up by 1.15 per cent week-on-week despite continued sell pressure on Aradel. The positive performance in this sector was largely buoyed by robust sentiment surrounding Conoil and Eterna. Additionally, the NGX-Banking index posted modest gains of 0.19 per cent week-on-week, thanks to upward price movements in Guaranty Trust Holding Company, Zenith Bank, and Fidelity Bank.
At the close of the trading week, 39 equities appreciated during the week lower than 58 equities in the previous week. Forty-five equities depreciated higher than 18 in the previous week, while 68 equities remained unchanged, lower than 76 recorded in the previous week.
Amid the sell-offs, the top weekly advancers were Transnational Corporation Plc which surged by 314.03 per cent to N45.75. Recall that the newly reconstructed issued share capital of 10,161,997,574 ordinary shares of 50 Kobo each of the conglomerate were listed on the Daily Official List of NGX at N44.2 per share during the week contributing to the gain of the stock. This move followed the delisting of the 40,647,990,293 issued shares of the indigenous conglomerate from the exchange.
Other gainers include Eunisell Interlinked Plc which appreciated by 61 per cent to close the week at N5.62, John Holt gained 20 per cent to close at N3.30, University Press PLC appreciated by 18.28 per cent and Livestock Feeds rose by 12 per cent to close at N3.83.
In contrast, the top decliners included Aradel which lost 25.75 per cent to close at N445.60, Caverton Offshore Support dipped 20 per cent to close at N2, Ellah Lakes lost 12.59 per cent of its share value to close at N3.54, Regency Assurance Plc shed 12.50 per cent to close at N0.49 and Royal Exchange suffered a 11.27 per cent decline to close the week’s trading at N0.63.
Experts opined that the decline in the benchmark index of the market underscored continued caution among investors, many of whom are taking a risk-off stance amidst fluctuating economic indicators, uncertain earnings outlooks, and ongoing corporate actions.
“Persistent liquidity concerns and inflationary pressures appear to have dampened investor enthusiasm, with many awaiting clearer signals on monetary policy and potential fiscal measures before making fresh commitments. Looking ahead, the market is likely to remain volatile in the near term considering the cautious sentiments of investors. However, positive developments, such as improved corporate earnings or stabilising macroeconomic conditions, could help bolster investor confidence and drive a recovery,” said researchers at Cowry Assets Management Limited.