Investors changed gear from the bargain-hunting mode of recent days to profit-taking on Wednesday, triggering another round of massive selloffs in the stock market. As against the recent modest trading pattern of the stock market, the benchmark index showed a three-digit loss of 1.27 per cent within the five hours of trading.
With nearly three decliners to every advancer, aggregate market value of all quoted equities dropped by N79 billion from its opening value of N8.197 trillion to close at N8.118 trillion. The All Share Index (ASI), which tracks prices of all quoted companies on the Nigerian Stock Exchange (NSE), declined from 23,834.87 points to close at 23,605.89 points.
Market analysts said the decline was due to profit-taking pressure, referring to tendency by active portfolio investors to sell their shares after booking some profit.
Nigerian Breweries, the second most capitalised stock on the NSE, recorded the highest loss, in value terms, of N4.25 to close at N95.25. Unilever Nigeria followed with a loss of N1.67 to close at N31.81. Dangote Cement dropped by N1.01 to close at N127. Guaranty Trust Bank lost 84 kobo to close at N15.54. Zenith Bank dipped by 71 kobo to close at N12.90 per share. UAC of Nigeria lost 70 kobo to close at N19.30. Cement Company of Northern Nigeria dropped by 50 kobo to close at N9.58 while Custodian Alliance and Portland Paints and Products Nigeria lost 19 kobo each to close at N3.88 and N3.61 respectively.
Turnover jumped to 1.25 billion shares worth N2.34 billion in 3,131 deals. The spike in turnover was driven mainly by transactions on Wema Bank, where a major cross deal pushed turnover to 1.14 billion shares valued at N1.09 billion in 25 deals. FBN Holdings was the second most active stock with a turnover of 35.6 million shares worth N141 million in 276 deals.
Sectoral analysis showed widespread negative sentiments across the sectors. The NSE Banking Index dropped by 2.9 per cent. The NSE Consumer Goods Index declined by 0.8 per cent. The NSE Industrial Goods Index also fell by 0.5 per cent. However, the NSE Oil and Gas Index and the NSE Insurance Index rose by 2.1 per cent and 0.55 per cent respectively.
“Given the sustained volatility in oil prices coupled with a weak domestic macro-economic outlook, the broader investor sentiments remain negative. As we expect more sell pressure in the trading session ahead, long-term investors’ could take advantage of cheap valuations to take long positions in value stocks in the banking and industrial sectors,” Afrinvest Securities, a Lagos-based dealer on the NSE, stated.
On the positive side, Seplat Petroleum Development Company continued its rally, leading the gainers with a gain of N21.94 to close at N236.09. Seven-Up Bottling Company followed with a gain of N9.95 to close at N186.95. Guinness Nigeria rose by N5.56 to close at N116.76. Flour Mills of Nigeria added N1.83 to close at N19.88 while International Breweries rose by N1.02 to close at N17.82 per share.
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