Caution was the word at the first trading session of 2016 at the Nigerian Stock Exchange (NSE) as bemused investors seek to outline the outlook for the stock market in the new fiscal year after two consecutive years of significant losses.
Trading opened low and slow as the ghost of the N3.38 trillion lost in the past two years lurked in the shadows. The All Share Index (ASI)-the value-based common index that tracks prices of all quoted companies at the NSE, declined by 0.95 per cent to close at 28,370.32 points as against its opening index of 28,642.25 points. Aggregate market value of all quoted equities dropped by N94 billion from N9.851 trillion to close at N9.757 trillion. With this, the average year-to-date return now stands at 0.95 per cent.
Turnover was below recent average. Total turnover on Monday stood at 98.97 million shares worth N700.52 million in 2,309 deals. The highest turnover was recorded by Austin Laz with a deal for 15.71 million shares worth at N32.84 million. FBN Holdings placed second with a turnover of 10.70 million shares worth N52.96 million in 246 deals. Transnational Corporation of Nigeria recorded a turnover of 8.45 million shares worth N12.77 million in 120 deals.
Nigerian equities slumped to their worst level in three years in 2015 after crude oil slump and badly shaped fiscal positions triggered foreign exchange crisis, which exacerbated the simmering slowdown in the capital market.
Against all projections, the Nigerian stock market closed 2015 with a negative full-year average return of -17.36 per cent, nearly a notch above -16.14 per cent recorded in 2014. Approximately, this implied a loss of N1.63 trillion in 2015, a somewhat hard-to-bear addition on a loss of N1.75 trillion recorded in 2014. Altogether, Nigerian equities had lost N3.38 trillion in the past two years, nearly a quarter of their market value of N13.226 trillion recorded at the beginning of the period.
With 18 losers to 12 gainers, market pundits said investors were worried that weak macroeconomic variables might further impact the performance of quoted companies and share prices at the stock market, forcing investors to take additional losses or low yields.
“Market performance today
mirrored the rather weak investors’ confidence on the outlook of the domestic economy together with a bearish global equities market environment which triggered a shutdown of the Chinese market today following a 7.0% drop. We do not expect a significant improvement in the near term,” stated Afrinvest Securities, a Lagos-based broker-dealer on the Exchange.
Nestle Nigeria, Nigeria’s highest-priced stock, led the losers with a loss of N30 to close at N830. Nigerian Breweries followed with a loss of N6.80 to close at N129.20. GlaxoSmithKline Consumer Nigeria dropped by N1.71 to close at N32.49.
Ashaka Cement dropped by N1 to close at N24. Transcorp Hotel lost 29 kobo to close at N5.51 per share. FBN Holdings dropped by 25 kobo t close at N4.88. Nigeria Aviation Handling Company declined by 17 kobo to close at N3.61. Champion Breweries and Nascon Allied Industries lost 15 kobo each to close at N3.22 and N7 respectively while Guaranty Trust bank dropped by 13 kobo to close at N18.05 per share.
On the upside, Okomu Oil Palm led the gainers with a gain of N1.48 to close at N31.78. Cement Company of Northern Nigeria rose by 31 kobo to close at N9.66. Zenith Bank added 25 kobo to close at N14.30. Guinness Nigeria chalked up 12 kobo to close at N120.52 while Oando gathered 10 kobo to close at N6 per share.
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