On Wednesday, the local stock market extended its bearish streak, with the All-Share Index and market capitalization both declining by 0.04 percent, closing at 98,023.23 points and N59.39 trillion, respectively. This marked the third consecutive day of losses as investors collectively saw a decrease of N22 billion in their investments. The prevailing sentiment in the market was attributed to sell-offs by investors, leading to negative trading conditions on the Nigerian Exchange Limited. Despite this downturn, a total of 33 stocks managed to record gains, while 23 stocks experienced losses, indicating a fragmented market where pockets of strength still existed amidst pervasive negativity.
Among the standout performers, UPL, VitaFoam, and Sky Aviation led the gainers’ list, with each stock appreciating by 10 percent to close at N3.08, N22, and N27.50 respectively. Their gains provided a silver lining in an otherwise challenging market environment. Conversely, the decliners included PZ Cussons and Jaiz Bank, which both suffered a 10 percent drop in their share values, closing at N18.90 and N2.25 respectively. ABC Transport was notable as well, losing 9.63 percent to close at N1.22, reflecting the volatility within various sectors of the market.
Sectoral performance varied considerably, with notable advancements in banking (+1.73 percent), oil and gas (+0.22 percent), and industrial goods (+0.24 percent). However, contrasting this, the insurance sector and consumer goods experienced declines of 0.71 percent and 0.11 percent respectively. This mixed performance underscores the complexities of current market dynamics and investor sentiment, suggesting that even amidst broader declines, certain sectors may exhibit resilience and growth opportunities.
Despite the overall negative sentiment reflected in the All-Share Index, trading activity showed signs of recovery, characterized by a surge in the number of deals, traded volume, and value. The increase was quantified with a growth of 5.04 percent in the number of deals, 34.97 percent in the volume of shares traded, and an impressive 71.43 percent rise in total value. In total, 538.96 million shares were exchanged across 10,028 deals, amounting to N15.30 billion. Notably, Jaiz Bank emerged as a leader in trading volume, handling 106 million units valued at N241 million over 211 transactions, demonstrating active investor participation despite prevailing market challenges.
The impact of trading activity was significant, especially considering that bargain hunting activities had resulted in a substantial loss of N394 billion from investors’ portfolios just the day prior. This highlights the volatile nature of the market, where investor behavior can rapidly swing from optimism to pessimism, underscoring the urgency for strategic investment decision-making. The slight recovery in trading volume and value indicates that some investors are willing to explore buying opportunities amidst the downturn, leading to a slightly more dynamic trading environment.
Additionally, developments in the foreign exchange market were noteworthy, as the naira depreciated by 0.04 percent, closing at 1,631.17 per dollar in the official sector. The parallel market saw a more pronounced depreciation, with the local currency closing at 1,745 to the dollar. This depreciation further reflects the ongoing economic challenges, as fluctuations in the exchange rate can directly influence market confidence and investor behavior. Overall, the combination of mixed sector performance, rising trading activity, and currency fluctuations paints a complex picture of the prevailing economic landscape, requiring careful navigation by market participants.
