The week ended January 15 will be remembered as one of the bloodiest on the Nigerian stock exchange as blue chip stocks lost billions in market valuation. This was a sell-off of immense proportion and the type that often takes years to actualize. The All Share Index lost a whopping 13% this week alone taking the total losses this year alone to 17.9%. Nigerian stocks have now lost a total of N1.7 trillion this year alone. Nigerian stocks lost N1.6 trillion in the whole of 2015. The likes of Oando, GTB, Zenith all lost massively as the chart above depicts. Some stocks have now lost over 50% of their value this year alone.
Driving this massive sell-offs are some of the most capitalized stocks in the exchange which by our estimates contributed to a about N800 billion out of the N1.7 trillion wiped out of the total market capitalization of the exchange. This chart above and the table below puts it into proper perspective;
|Company||Value Lost (N’b)|
Analysts believe the reason for the sell-offs can be attributed to the press release issued by the CBN last Monday where it admitted that it could no longer meet the quantum of forex demand prioritizing fuel subsidy, imports of select materials and inputs and school fees. The global economic turmoil is also not helping as the world looks to events in China and the middle east with fear. Trading this week is expected to resume on the downward trend but may not be as brutal as it was last week. Even though stocks still have room to fall further down, bargain hunters are likely to return to the market this week with bids.