NSE records 18.18% decline in banks' market capitalisation

The Nigerian Stock Exchange (NSE) has witnessed a losing streak that led to the loss of N352 billion in eight days after market capitalisation of equities listed on the NSE closed at N10.627 trillion on Wednesday.

Investors lost N352 billion following the decline of the market capitalisation of equities which fell below the N11 trillion mark. The margin had risen to N10.979 trillion on May 3,  only to drop to N10.627 trillion yesterday.

The market recorded its eighth consecutive day losses after investors lost N51 billion on Wednesday, further dragging the stock market down. Also, sell-offs drove the All Share Index 0.48 percent lower to 28,286.08 basis points, while the year-to-date loss dipped to –9.6 percent on Wednesday.

This is almost half of the N713 billion investors lost in April 2019, after the Stock market closed the month lower than the market capitalisation and the All Share Index it opened the month of April with.

Volume and value traded fell by 11.7 percent and 22.8 percent to 176.742 million units and N2.1bn, respectively.

Losers tableWapic Insurance‘s share price dropped by 10 percent, with Forte Oil recording 9.87 percent drop in share price, while Champion Breweries Plc share price dropped by 9.79 percent, respectively.

What caused the drop? Price depreciation in Dangote Cement Plc, Union Bank of Nigeria Plc and United Bank for Africa Plc were highlighted as major drivers of the bearish performance, Analysts at Afrinvest Securities disclosed.

Rebound is expected: Despite the eight days losing streak, the Afrinvest Securities analysts predict the market will rebound before trading closes for this week.

According to analysts at Afrinvest;

Deal book 300 x 250

“We anticipate a possible rebound before close of the week as investors buy the dip for fundamental stocks with attractive entry prices.”

The top traded stocks by volumeAccess Bank Plc (35.8 million units), UAC Nigeria Plc (21.5 million units) and UBA (18.8 million units).

The top traded stocks by valueGuaranty Trust Bank Plc (N551.1 million), Nestlé Nigeria Plc (N360.1 million) and Zenith Bank Plc (N255.6 million).

The performance across sectors was bearish as all indices trended southwards.

Decliners: The decliners’ table was led by the

  • Industrial goods index led the decliners table, shedding 2.31 percent following sell pressures in Dangote Cement and Cement Company of Northern Nigeria Plc.
  • Insurance index: Sell-offs in Wapic Insurance Plc and AXA Mansard Insurance Plc pulled the insurance index down by 1.01 percent.
  • Oil and gas index shed one percent on the back of major share price depreciation in Forte Oil Plc.
  • The banking index closed 0.74 percent lower due to losses recorded in Union Bank and UBA.
  • Consumer goods index experienced decline by 0.07 percent following profit-taking in Dangote Flour Mills Plc and Champion Breweries Plc.

Meanwhile, investor sentiment weakened to 0.6x from the 1.3x recorded on Wednesday as 11 stocks advanced against 17 stocks decliners.

The top-performing stocks: Chams Plc gained 9.1 percent, Associated Bus Company Plc gained eight percent and Thomas Wyatt Nigeria Plc gained 7.4 percent.

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