Sell Pressure in Dangote Cement, Zenith, Mobil Drag Stock Market Losses to Third Consecutive Day

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The sell pressure witnessed in bellwether stocks such as Dangote Cement, Zenith, Mobil during trading on Wednesday, July 3, propelled losses recorded in the country’s stock market to drag till the third consecutive day.

The bearish performance on the local bourse consequently saw the benchmark index close 7 basis points lower at 29,375.25 points while year-to-date loss settled at -6.5%.

Accordingly, investors lost N8.8bn in value as market capitalisation decreased to N12.9tn.

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However, activity level was mixed as volume traded rose 18.5% to 237.7m units while value traded fell 31.5% to N2.0bn.

The top traded stocks by volume were MORISON (44.5m units), UBA (34.1m units) and STERLING (32.1m units) while ZENITH (N541.1m), GUARANTY (N375.1m) and UBA (N209.6m) led by value.

Across sectors, performance was largely bullish as 4 of 6 indices trended northward save the AFR-ICT index which traded flat.

The Industrial Goods index led gainers, up 1.7%, due to sustained gains in WAPCO (+6.0%) and CCNN (+3.6%). Similarly, the Insurance and Consumer Goods indices rebounded, rising 0.5% apiece on account of buy interest in WAPIC (+9.3%), UNILEVER (+4.2%) and DANGSUGAR (+2.8%).

On the flip side, the Oil & Gas index led laggards, declining 0.7%, due to a loss in MOBIL (-9.7%) while sell-offs in ZENITH (-1.0%) and FBNH (-2.3%) drove the Banking index 0.6% lower.

Strengthened investor sentiment

Investor sentiment, measured by market breadth (advance/decline ratio) strengthened to 0.7x from 0.6x recorded in the preceding session as 16 stocks advanced against 23 that declined.

The top performing stocks were BOCGAS (+9.9%), ACADEMY (+9.7%) and WAPIC (+9.3%) while MORISON (-10.0%), FIDSON (-9.9%) and MOBIL (-9.7%) were the worst performers.

Analysts at Afrinvest says, the bearish market performance is expected to be sustained in subsequent sessions as investor sentiment stays soft.

However, they do not rule out the possibility of some end of the week bargain hunting as investors take advantage of attractive market prices.