By Kayode Tokede
The equities market performance of the Nigerian Exchange Limited (NGX) last week dropped by 0.1 per cent as it was not immune to the rout in global equities.
This is coming on the heels of losses recorded on the last trading day (Friday: -0.5per cent) that eroded the cumulative 0.4per cent gain as of the penultimate trading day. Precisely, selloffs in bellwether — Nestle Nigeria (-9.1per cent) drove the weekly loss.
As a result, the NGX All-Share Index declined marginally by 0.1per cent w/w to close at 39,483.08 basis points. Consequently, the MTD and YTD return settled at +2.4per cent and –two per cent, respectively.
Activity levels were weaker than the prior week, as trading volumes and value declined by 45.9% w/w and 2.4% w/w, respectively.
Save for the Industrial Goods (+1.9per cent) index that closed in the green; the Consumer Goods (-6.3per cent), Insurance (-1.0%), Banking (-0.8per cent) and Oil and Gas (-0.6per cent) indices closed in the red.
The NGX weekly report stated that, “A total turnover of 866.544 million shares worth N12.257 billion in 17,291 deals were traded this week by investors on the floor of the Exchange, in contrast to a total of 1.610 billion shares valued at N12.586 billion that exchanged hands last week in 18,622 deals.
“The Financial Services Industry (measured by volume) led the activity chart with 445.324 million shares valued at N3.676 billion traded in 7,560 deals; thus contributing 51.39per cent and 29.99per cent to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 119.649 million shares worth N4.969 billion in 3,424 deals.
“The third place was ICT, with a turnover of 87.132 million shares worth N1.938 billion in 924 deals. Trading in the top three equities namely Honeywell Flour Mill Plc, Transnational Corporation of Nigeria Plc and Guaranty Trust Holding Company Plc (measured by volume) accounted for 203.753 million shares worth 1.964 billion in 2,515 deals, contributing 23.51per cent and 16.02per cent to the total equity turnover volume and value respectively.”
According to analysts at Cordros capital, “We expect the bulls to regain dominance in the market given the moderation in the prices of bellwether stocks this week amid the declining yields in the fixed income market. However, we do not rule out the possibility of continued profit-taking activities.
“As a result, we think the choppy trading pattern that played out this week will persist in the week ahead. Overall, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings.”