The NSEASI recorded its second decline in as many days today, paring by 0.17% to peg the YtD return of the market at –15.16%. Also, the volume and value of transactions declined respectively by 33.38% and 27.82% correspondingly, while 24 stocks advanced against 27 stocks that pared to skew the market breadth (0.89x) in favour of decliners.
HONYFLOUR led the outperformers, after recording a price appreciation of 9.13%. Other top performers were DIAMONDBNK and GUINNESS with gains of 5.00% apiece. Following closely were CONTINSURE (+4.94%) and NEM (+4.69%). On the other hand, UBCAP led the underperformers with a price decline of 9.27% to close at NGN1.37. Other laggards were VONO (-9.26%), UBA (-8.74%), FBNH (-7.24%) and SKYEBANK (-6.78%).
However the NSE sector indices did not reflected the bearish mood of the market, as most of the indices trended northwards. The NSEFBT10 (1.30%), NSEIND (1.02%), NSEINS10 (0.69%) and NSEOILG5 (0.12 %%) indices all advanced, while the NSEBNK10 (-2.19 %) index pared.
According to Reuters, Stock market investors joined the sell-off, worrying that Nigeria might also be evicted from the MSCI frontier index and dollar shortages would make it hard to exit the market.
“Sooner or later, equity investors will wonder whether this could also lead to action by MSCI,” Renaissance Capital said in a note.
After the index level fell to an intra-day low of 28,613.89pts (-2.85%), there was a rally at the end of trading which resulted in only a marginal decline. We attribute this to the residual effects of the news flow regarding Nigeria’s exclusion from the JP Morgan GBI-EM dictating the start of day activities, while bargain hunting dictated the close.
Mersitem believes, the Apex bank’s unrelenting stance regarding FX trading rules might not bode well for the market in the short term, as such the outlook is not entirely bearish.
They however advise investors to trade with caution, and limit position taking to fundamentally justified stocks.