By Peter Egwuatu
The Nigerian Exchange Limited, NGX, has recorded its largest weekly and yearly loss as the stock market All Share Index, declined by 6.7 per cent to close at 44,396.73 points, the lowest since 18th January this year, from 47, 569.04 points the penultimate week.
Consequently, investors lost over N1.7 trillion in the week’s trading with the NGX market capitalisation declining to N24.181 trillion from N25.909 trillion the previous week.
Analysis of the market showed that the selloffs of top telecommunication player, AIRTEL Africa by 27.1 percent underpinned the market’s performance. Consequently, the Month-to-Date, MtD, loss increased to -9.4 per cent, while the Year-to-Date, YtD, return moderated significantly to 3.9 per cent.
However, activity levels were positive, as trading volume and value increased by 90.7 per cent Week-on-Week, W/W and 40.1 per cent W/W, respectively.
Sectoral performance was mixed as the Industrial Goods index advanced by 3.2 per cent and Banking Index 1.2 per cent while the Insurance Index declined by 3.7 per cent , Oil and Gas 1.5 per cent , and Consumer Goods 0.9 per cent .
Reacting on market development, analysts at Cordros Capital, a Lagos based in investment house stated: “ With the significant moderation in the prices of bellwether stocks last week, we expect savvy investors to take advantage of this and make a re-entry into stocks with sound fundamentals and attractive dividend yields. However, we do not rule out the possibility of continued profit-taking activities.
‘‘As a result, we envisage a choppy trading pattern. Nonetheless, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings.”
Reacting as well, analysts at InvestData Consulting Limited, said: “We expect mixed sentiments to continue on reaction to earnings release so far and bargain hunters are taking advantage of the low prices to reposition ahead of more Q3 corporate earnings.”
Firstword24 