Stocks open week bearish as index drops by 0.44%

Sell-offs in BUACEMENT underpin N54bn loss as equities opens week

Stocks open week bearish as index drops by 0.44%


 

 

The domestic equities market on Monday launched a new trading week with 0.44 per cent loss as the benchmark index declined on high capitalised stock.

The All-Share Index (ASI) shed 175.42 basis points equivalent 0.44 per cent value loss to close at 39,306.47 basis points.

Similarly, the overall value of equities at the market followed suit as investors lost N92 billion to see the market CAP close at N20.487 trillion.

Sector performance was broadly negative today with the Banking (-0.59per cent), Consumer Goods (-0.09 per cent) and Industrial (-0.06 per cent) sectors all closing in the red, while the Oil and Gas (+0.21 per cent) sector was the lone gainer.

The downtrend was driven by price depreciation in medium and large capitalised stocks amongst which are; Nigerian Enamelware, MTN Nigeria Communications (MTNN), Stanbic IBTC Holdings, BUA Cement and Lafarge Africa.

However, market sentiment, as measured by market breadth, was positive as 22 stocks gained, relative to 14 losers.

Eterna recorded the highest price gain of 9.85 per cent to close at N7.25, per share. Royal Exchange followed with a gain 9.21 per cent to close at 83 kobo, while Capital Hotel appreciated by 9.09 per cent to close at N2.40, per share.

Regency Alliance Insurance rose by 8.82 per cent to close at 37 kobo, while Sterling Bank and Associated Bus Company appreciated by 8.11 per cent each, to close at N1.60 and 40 kobo, per share.

Conversely, Nigerian Enamelware led the losers’ chart by 9.80 per cent to close at N17.95, per share.

Africa Prudential followed with a decline of 6.92 per cent, to close at N6.05, while NPF Microfinance Bank shed 6.42 per cent to close at N1.75 per share.

Wema Bank shed 5.17 per cent to close at 55 kobo, while AXA Mansard Insurance depreciated by 3.30 per cent to close at 88 kobo, per share.

In terms of turnover for the session, the total volume of trades rose by 62.9 per cent to 357.693 million units, valued at N3.565 billion, and exchanged in 4,394 deals.

Transactions in the shares of Zenith Bank topped the activity chart with 52.676 million shares valued at N1.247 billion. FBN Holdings (FBNH) followed with 42.469 million shares worth N307.148 million, while NEM Insurance traded 39.449 million shares valued at N88.646 million.

Sovereign Trust Insurance traded 23.617 million shares valued at N6.158 million, while Fidelity Bank transacted 23.330 million shares worth N55.768 million.

According to analysts at Investment One research, “The equities market closed down today due to the losses recorded in the most sectors.

“Going forward, we expect investor’s sentiments to be swayed by the search for real positive returns and developments in the interest rate space.

“We reiterate that this may be a great period to pick up some quality names with a medium to long-term investment horizon.”

Meanwhile, the event of the day seemed to have followed prediction by analysts in some quarters who ruled out a flawless new week as experienced last week where the bulls dominated the three trading session.

Cordros Capital analysts said,” the possibility of the bulls repeating the flawless pattern of victory that ensued last week is unrealistic as the bears are likely to book profit across most counters.

“Consequently, we see more of a “choppy theme” as cautious trading takes centre stage ahead of a critical MPC meeting scheduled later in the month.

“Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the weak macro story remains a significant headwind for corporate earnings,” said the analysts.