How stock investors lose N416bn in four days
Investors in the Nigerian equities market had a terrible first week of May with collective losses estimated at N416 billion as profit-taking overwhelmed the market.
The week which opened on Tuesday due to the observation of Worker’s Day Holiday on Monday as declared by the federal Government of Nigeria had three of the four trading sessions cloaked in red.
Notably, profit-taking in STANBIC (-6.0 per cent), MTNN (-4.1 per cent), GUARANTY (-2.8 per cent), and DANGCEM (-2.5 per cent) drove the weekly loss.
Sectoral performance was positive as the Oil and Gas (+5.3 per cent), Consumer Goods (+0.6 per cent), and Banking (+0.6 per cent) indices recorded gains. On the flip side, the Insurance (-2.2 per cent) and Industrial Goods (-1.6 per cent) indices closed in the red.
Consequently, the bourse shed N416 billion to close at N 20,431 while the Nigeria Exchange Limited (NGX) All-Share Index (ASI) closed southwards, declining 1.6 per cent week on week to settle at 39,198.75 basis points. Similarly, YTD losses worsened to -2.7 per cent.
Although the equities market performance was bearishly mixed last week, analysts anticipate a rebound in equities as investors take advantage of bargain hunting opportunities on renewed sentiments.
On the other hand, the level of trading activity strengthened as average volume and value exchanged in the bourse last week rose 23.1 per cent and 82.8 per cent to 238.9 million units and N3 billion respectively.
The top traded stocks by volume were Access Bank Profit-taking puts shade on first trading week in May (252.1 million units), First Bank Holdings (219.9 million units) and Zenith Bank (138.0 million units) while Zenith Bank (N3.0 billion), Access Bank (N2.0 billion) and GTBank (N1.7 billion) led by value.
As measured by the market breadth, investor sentiment strengthened to 1.0x from 0.8x as 32 stocks advanced against 32 that declined.
Top performing stocks for the week were Royal Exchange Plc (+22.6 per cent), Sovereign Trust Insurance (+17.4 per cent) and Linkage Assurance (+13.1 per cent), while Courtville Plc (-13.0 per cent), NEM Insurance (-10.8 per cent) and BOC Gas (-10.0 per cent) were the laggards.
Meanwhile, at the close of the trading week in the first week in May, the NSE 30 Index decreased by -1.94 per cent to close at 1,567.42 points as against 1598.45 points as on the previous week.
In their comment, analysts at Cordros Capital plc explained that with the Q1 2021 earnings season now out of the way, a choppy theme will be the order of the day as investors keep their gaze on yield movements in the Fixed Income market.
They anticipated that going into a new week, the bears will likely maintain dominance as the absence of positive triggers will limit buying interest from the bulls.
“Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the weak macro story remains a significant headwind for corporate earnings,” they added.