Connect with us

Business

NSE LIVE! Equities lose N228b amidst global stock plunge

Published

on

NSE LIVE! High-cap stocks depress equities

In from Success Allantee …
Nigerian equities lost N228 billion in five hours of trading yesterday as the worsening crisis in the China stock market triggered a major rout of the global stock markets on Monday. The negative start worsened Nigeria’s stock market outlook and raised the pressure on investors, which had lost N283 billion last week.
The global stock markets took a major plunge on Monday after China suffered its worst trading session in eight years. An unprecedented collapse in Chinese shares sent tremors through financial markets on, triggering the ugliest day of global trading since the depths of the financial crisis eight years ago.
Average decline at the Nigerian Stock Exchange (NSE) stood at 2.22 per cent as relatively higher losses by 46 stocks, including market’s largest stocks, overwhelmed modest gains by nine stocks. The opening downtrend pushed the negative average year-to-date return at the Nigerian stock market to -15.71 per cent.
Aggregate market value of all quoted companies on the NSE closed on the thresholds of its psychological N10 trillion position at N10.013 trillion as against its opening value of N10.241 trillion, representing a loss of N228 billion or 2.22 per cent. The All Share Index (ASI), the general value-based index that tracks prices of all quoted equities, slumped to 29,214.13 points as against its opening index of 29,878.33 points, a day-on-day decline of 2.22 per cent.
With market’s largest stocks such as Dangote Cement, Nigerian Breweries, Guinness Nigeria and Total Nigeria heralding the losers, the market position was worsened by both the spread of the losing streak as well as the relatively higher values lost, especially within the highly capitalised stocks group.
The negative market position appeared to be unnerving the more optimistic investors, lowering demand and increasing open-order supply, which has virtually turned the market into a discount window.
Market analysts were negative on the market outlook in the short-term, although there were almost unanimity on the good prospects of Nigerian equities in the medium to long terms.
“We anticipate another round of bearish trading at tomorrow`s trading session (Tuesday) as there are no catalysts in the horizon to spur positive sentiments. The tumbling in global oil prices at the international markets may also be taking its toll on the market,” SCM Capital, formerly Sterling Capital Markets, stated in post-trading review.
Afrinvest Securities said Monday’s performance further reflected the negative sentiments that have persisted in the Nigerian equities market.
“We hold on to our advice to investors on taking medium to long term positions as headwinds continue to bedevil the equities market in the short term,” Afrinvest Securities stated.

Price trend analysis showed that Seplat Petroleum Development Company topped the losers’ list with a loss of N12.26 to close at N233.04. Dangote Cement, NSE’s most capitalised stock, followed with a loss of N7 to close at N170. Guinness Nigeria and Total Nigeria dropped by N3 each to close at N116 and N152 respectively. PZ Cussons Nigeria, which at the weekend declared a dividend of 61 kobo per share, declined by N2.90 to close at N26.93. Nigerian Breweries, Nigeria’s second most capitalised stock, lost N2.02 to close at N118. Mobil Oil Nigeria dropped by N1.20 to close at N150. Okomu Oil Palm lost N1.08 to close at N20.63 while GlaxoSmithKline Consumer Nigeria and Presco lost N1 each to close at N35 and N31 respectively.
On the positive side, Forte Oil led the gainers with a gain of N10.40 to close at N239.10. Flour Mills rose by N1.25 to close at N26.32. Lafarge Africa added 49 kobo to close at N99.99. Paints Manufacturing Company gained 10 kobo to close at N1.20 while Wema Bank inched up by seven kobo to close at 87 kobo.
Total turnover stood at 257.74 million shares worth N2.78 billion in 4,252 deals. Financial services sector remained the most active with a turnover of 207.82 million shares valued at N1.89 billion in 2,661 deals.
On stock by stock basis, Zenith Bank was the most active stock with a turnover of 75.76 million shares worth N1.1 billion in 569 deals. Access Bank followed on the activities chart with a turnover of 46.49 million shares worth N211.5 million in 423 deals. United Bank for Africa (UBA) placed third with a turnover of 21.51 million shares worth N69.1 million in 214 deals.
Billions were wiped off indices across the world in a day of frenetic selling which saw the Shanghai composite suffer an 8.5 per cent decline, its worst one-day performance since 2007. The mass panic, dubbed “Black Monday” by China’s official state news agency, was driven by investors’ dashed hopes that Beijing would inject a fresh round of stimulus into its economy following a series of disappointing data last week.
China’s benchmark index has now lost all of its yearly gains after a relentless ascent that saw its valuation rise to record levels earlier this year. Asian markets crashed on the news, with Japan’s Nikkei closing down 4.5 per cent and entering official “correction” territory. Hong Kong’s Hang Seng sanki 5.2 per cent, its steepest sell-off in 30 years.
Emerging markets, most exposed to a waning Chinese economy, saw their currencies continue an abysmal summer rout. Russia’s rouble fell to an all-time low of 70.74 to the dollar, despite desperate attempts by the Kremlin to prop up its value.
Contagion quickly spread west, decimating European indices, which all suffered record post-crisis losses. The FTSE 100 dropped 4.7 per cent, wiping £74 billion off its market capitalisation and capping its worst one-day performance since March 2009.
The index staged a minor rebound, having lost more than £55 billion in the first two hours of morning trading. Britain’s benchmark index has now collapsed by 17 per cent since hitting a high of 7,104 in April and is slipping towards official bear market territory, defined as a 20 per cent decline from its peak.
Europe’s FTSE EuroFirst300 stocks endured a 5.6pc loss that erased €450bn from the continent’s biggest companies. Italian stocks led the falls, down 6pc, while France’s CAC 40 suffered a 5.4pc decline, closing at 4383.46. Germany’s DAX also entered correction territory, bleeding 4.7pc.
“Stock markets are falling apart at the seams,” said Jasper Lawler at CMC Markets.
“There was one point today when there just seemed to be no buyers and markets just went into freefall.”
Fears soon engulfed Wall Street, where the Dow Jones lost 1,000 points minutes after the opening bell. Pre-market futures trading in the Dow and the S&P 500 had to be suspended as investors became embroiled in a manic sell-off. The Dow later rallied to fall by 2.6 per cent in New York’s afternoon trading.

Read also: NSE LIVE! Financial stocks lead Nigerian equities to N283b loss

A key measure of US equity volatility, the CBOE Volatility Index, or VIX, shot above the 50 mark for the first time since 2009 before dropping back to 33 as US investors turned their focus back to domestic US issues.
“With those markets closed, it’s now focused more on US fundamentals. The US economy remains relatively strong compared to others around the world,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.
The Dow Jones industrial average was down 346.07 points, or 2.10 percent, at 16,113.68. The Standard & Poor’s 500 Index was down 47.72 points, or 2.42 percent, at 1,923.17. The Nasdaq Composite Index was down 94.91 points, or 2.02 percent, at 4,611.13.

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