Nigerian stocks post massive correction as index falls to 7 weeks low

The Nigerian Stock Exchange recorded a massive correction as stocks fell to its lowest level in nearly two months at the close of trading September 15th, 2017.

Reason for the decline

Investors surveyed by Nairametrics suggest the decline was attributed to a market correction as investors old off to pocket more profits. At a 30% gain, the Nigerian stock market is still one of the better performers around the world suggesting that there could be more room for sell-offs.

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Some analysts also suggest that the tepid GDP Growth rate which confirmed Nigeria was out of recession may not have impressed some investors still waiting on the sidelines and those hoping to throw in more money into the market.

Data from the NSE also indicates that this week’s fall is also largely attributed to the 3.26% fall in the share price of Dangote Cement, the most capitalized stock on the exchange.

Market data

The All share index shed about 2.65% at the end of the week bringing the year to date returns to 30.26%. Data for the NSE also reveals about twenty-three (23) equities appreciated in price during the week, lower than twenty-eight (28) of the
previous week. Forty-five (45) equities depreciated in price, higher than thirty-eight (38) equities of the previous week, while one hundred and four (104) equities remained unchanged lower than one hundred and five (105) equities recorded in the preceding week.

NEM Insurance topped the gainers list as it 19.00% at the end of the week to close at NGN1.19. Here are the others;

Gainers: CILEASING (+12.26%), INTBREW (+9.50%), AIRSERVICE (+9.06%) and UACN (+5.82%) .

Losers: NEIMETH led with a 15.66% price decline, closing the week at NGN0.70. The  was closely followed by SKYEBANK (-11.86%), MAYBAKER (10.67%), FLOURMILL (-8.67%) and LINKASSURE (-7.81%).

During the week, United Kapital and Unity Insurance got their share price marked down after they paid a dividend of 5 kobo and 6 kobo respectively. UACN also listed an additional volume of 879,645,796 units of UACN Property Development Co. Limited resulting from the just concluded right issue were added to its outstanding shares on Thursday 14th of September, 2017. By this action, the total outstanding shares of the company now stood at 2,598,395,791.