Bearish Sentiment Prevails on NGX as market Cap Plunges by N1.07trn as Investors Sell-off

The Nigerian Exchange Limited (NGX) witnessed a bearish trend on Wednesday, with market capitalization dropping by N1.07 trillion.

Specifically, the market capitalization closed at N55.357 trillion, representing a 1.89% decrease from N56.425 trillion recorded on Tuesday. Similarly, the NGX All-Share Index (ASI) fell by 1.89%, closing at 101,158.46 compared to 103,110.15 on Tuesday.

Losses in MTN Nigeria, Zenith Bank, and Guaranty Trust Holding Company (GTCO) were the primary drivers of the market decline. Consequently, the Year-to-Date (YTD) return decreased to 35.28%.

Despite the decline, trading activity was relatively high, with a total of 749.13 million shares valued at N22.49 billion exchanged in 14,092 deals.

However, the market breadth remained negative, with 50 declining equities outnumbering 9 advancing ones. UPDC, Zenith Bank, Royal Exchange Plc, May & Baker Nigeria, and Sterling Nigeria led the laggards’ chart in percentage terms, each dropping 10% to close at N1.80, N35.10, 72k, N6.21, and N5.67 per share, respectively.

Conversely, Tripple Gee & Co Plc and PZ Cusson Nigeria led the gainers’ chart, each rising 9.97% to close at N3.42 and N33.10 per share, respectively. Geregu Power and McNichols Plc also saw significant gains, increasing by 9.69% and 9.66% to close at N517.80 and N1.59 per share, respectively. Veritas Kapital Assurance rounded out the top gainers with a 9.09% rise to close at 60k per share.

Transcorp Hotel led in terms of trading volume, with 79.68 million shares traded at N1.06 billion. United Bank of Africa (UBA) followed with 61.34 million shares worth N1.55 billion. Zenith Bank and GTCO also saw significant trading activity, with 61.18 million shares and 47.91 million shares traded at N2.26 billion and N1.84 billion, respectively. Access Corporation also saw notable volume, with 43.49 million shares traded at N1.04 billion per share.

Analysis of the market activities showed that trade turnover was higher compared to the previous session, with the value of transactions increasing by 102.88%.

Reacting to the market performance, Mr. Sam Ndata, Doyen of Nigerian Stockbrokers, assured investors that there is no need for worry. He emphasised that market fluctuations are a natural occurrence and that the recent decline does not necessarily indicate a negative trend. He stated, “The market has been on a rising trend for weeks now, so the nature of investment must take its course. It is a regular practice for investors to sell-off part of their investment, and that is why we witnessed a drop in the market record. We believe that by tomorrow or following days the market will rise again.”

NAN