Stock Market Performance Remains Red on Absent Economic Catalyst

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Following an absence of a major catalyst to the Nigerian economy, trading on the equities segment of the Nigerian Stock Exchange (NSE) which comprises over 160 listed companies across diverse sectors of the country has continued to record decline.

Lead indicator for the local bourse, the All Share Index (ASI) resumed trading from the democracy day holiday on Wednesday June 12, by shedding 23 basis points to settle at 30,029.15 points.

This was majorly as a result of losses in DANGCEM (-1.1%), DANGSUGAR (-2.7%) and ACCESS (-1.6%). Consequently, market capitalisation shed N31.1bn to settle at N13.2tn while year-to-date loss worsened to -4.5%.
A review of activity level however showed a measure of improvement as volume and value traded advanced by 3.9% and 69.2% to 242.6m units and N6.0bn respectively.

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GUARANTY (78.3m units), ZENITHBANK (34.0m units) and UBA (25.5m units) were the top trades by volume while GUARANTY (N2.4bn), MTNN (N1.3bn) and ZENITHBANK (N681m) led the top trades by value.

Across sectors, trading ended largely bullish with 5 of 6 major indices recording growth. The Oil & Gas index led advancers with a gain of 0.2% following buying interest in OANDO (+1.3%) and FORTE (+0.9%), followed by the banking index which advanced 0.1% due to price appreciation in GUARANTY (+1.0%).

The Insurance and Consumer Goods indices trailed with gains of 7bps and 2bps respectively on the back of gains in MBENEFIT (+5.0%), AIICO (+1.5%), NIGERIAN BREWERIES (+0.9%) and UNILEVER (+0.2%). The AFRI-ICT index also appreciated by 0.1% following a positive performance in MTNN (+0.1%). On the flip side, the Industrial Goods index declined by 0.6% as DANGCEM shed -1.1%.

Investor sentiment as measured by market breadth (advance/decline ratio) strengthened to 0.9x from 0.6x recorded in the previous session as 14 stocks advanced against 15 decliners.

Top performers were GLAXOSMITH (+9.2%), MAYBAKER (+6.3%) and MBENEFIT (+5.0%) while CILEASING (-9.9%), NPFMCRBK (-9.7%) and UAC-PROP (-8.5%) declined the most.

The slight uptick in activity is being attributed to the beginning of bargain hunting. According to analysts at Afrinvest, bargain hunting activities in stocks with attractive prices is expected. They however noted that this may be short lived in the absence of a major catalyst to the economy.