NSE LIVE! Equities in free fall as investors weigh in on Q3 earnings

Nearly three out of every four stocks that witnessed price changes at the Nigerian stock market yesterday ended in the red as investors continued to react to inflow of largely unimpressive third quarter earnings.

The benchmark index at the Nigerian Stock Exchange (NSE) slipped below its psychological 30,000 basis points, highlighting the concerns that have traced mixed reports by quoted companies. The hitherto negative market also appeared to have deadened expected reactions to some positive reports, including a dividend recommendation of foods and beverages giant, Nestle Nigeria.

The All Share Index (ASI), the value-based common index that tracks prices of all quoted shares and serves as stock market’s benchmark index, dropped by 0.61 per cent to 29,828.95 points as against its opening index of 30,011.89 points. Aggregate market value of all quoted equities also depreciated by N63 billion from N10.314 trillion to close at N10.251 trillion.

The decline yesterday, the fourth consecutive negative trading session since the large inflow of corporate earnings, further worsened the negative average year-to-date return at the stock market to -13.93 per cent.

With 28 losers to 10 gainers, the market continued to show widespread negative sentiments even as investors increased volume of transaction above recent average. All group indices closed on the negative with the exception of the NSE Industrial Goods Index which inched up by 0.2%. The NSE Oil & Gas Index declined 1.5%. The NSE Insurance Index lost 1.0%. The NSE Consumer Goods Index declined by 6% while the NSE Banking Index shed 0.3% .

Analysts at Afrinvest Securities said the market’s performance reflected “lackluster earnings declared by quoted companies which further doused investors’ sentiment”.

The negative overall market situation was worsened yesterday by the announcement by the Financial Reporting Council of Nigeria (FRCN) that it had suspended four directors of Stanbic IBTC Bank and reported the bank to EFCC for alleged financial misstatements. There was also a report that the Central Bank of Nigeria (CBN) had sanctioned FBN Holdings and United Bank for Africa (UBA) to the tune of N2.9bn and N1.9bn respectively for non-remittance of NNPC funds into the consolidated government Treasury Account with the apex bank. The market also continued to grapple with the mind-boggling losses by Oando Plc, which came under heavy selling pressure yesterday.

“The weak sentiment for equities as well as lackluster earnings result by quoted companies will in the short term continue to weigh down on equities market performance. We anticipate further reactions on Oando in the trading sessions ahead as the stock closed on full offer. Banking stocks, mostly Tier-2, may also record some sell-offs,” Afrinvest Securities stated.

RipplesNigeria …without borders, without fears

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now