The Nigerian Exchange (NGX) experienced a downturn in the week concluding on September 8, 2023, registering a net loss of N833 billion in market capitalization. This decline occurred during a holiday-shortened trading week, with markets closed on Friday for the Eid el Maulud celebration. The NGX All-Share Index, a key indicator of market performance, retreated by 0.94%, settling at 138,980.01 points. This negative trend affected overall market capitalization, which dipped to N87.937 trillion. While most market indices mirrored this downward trend, the Growth Index and Commodity Index offered a sliver of positivity, recording marginal gains of 0.15% and 0.04%, respectively. The ASeM Index, representing small and medium-sized enterprises, remained unchanged.
Trading activity during the week witnessed a turnover of 3.117 billion shares worth N90.295 billion, executed across 118,018 deals. Although the deal count decreased compared to the previous week, the total value of traded shares increased. The Financial Services sector dominated trading activity, accounting for 81.55% of the total traded volume and 33.62% of the total value. This sector saw 2.542 billion shares worth N30.357 billion exchange hands. Following the Financial Services sector were the Services and Consumer Goods industries. The Services Industry traded 114.610 million shares valued at N816.381 million, while the Consumer Goods Industry recorded a turnover of 105.452 million shares worth N5.492 billion.
Sovereign Trust Insurance Plc, Access Holdings Plc, and Fidelity Bank Plc emerged as the most actively traded equities by volume, collectively accounting for 1.685 billion shares worth N9.813 billion. These three equities alone constituted 54.05% of the total traded volume and 10.87% of the total value. Sovereign Trust Insurance Plc led the pack with a staggering 1.416 billion shares traded, followed by Nigerian Breweries Plc and Fidelity Bank Plc. Zenith Bank Plc also saw significant trading activity, with 26.4 million shares worth N1.70 billion changing hands.
Price movements during the week painted a mixed picture. While 19 equities appreciated in value, a larger number, 64, experienced declines. Another 64 equities maintained their previous week’s closing prices. Sovereign Trust Insurance Plc led the gainers, registering a 14.23% increase in its share price. Secure Electronic Technology Plc and Cornerstone Insurance Plc followed suit, recording gains of 12.94% and 12.36%, respectively. Other notable gainers included NCR Nigeria Plc, SCOA Nigeria Plc, and Guinea Insurance Plc.
Conversely, DAAR Communications Plc led the decliners, experiencing a substantial 21.10% drop in its share price. UPDC Plc and AIICO Insurance Plc followed, declining by 13.85% and 13.61% respectively. The list of significant losers also included Champion Breweries Plc, PZ Cussons Nigeria Plc, and Lafarge Africa Plc, all experiencing double-digit percentage declines. Learn Africa Plc, Eterna Plc, and University Press Plc further contributed to the negative price trend, recording declines of 10%, 10%, and 9.75%, respectively.
Market analysts attributed the overall negative performance to a confluence of factors, including profit-taking activities by investors, cautious sentiment due to the shortened trading week, and generally weak investor appetite driven by persistent macroeconomic concerns. These concerns likely contributed to the broader market decline, outweighing positive news or individual company performance in several sectors. The combination of profit-taking and cautious sentiment suggests a degree of uncertainty among investors regarding the short-term market outlook. This hesitancy, coupled with broader economic worries, likely contributed to the subdued trading activity and the overall decline in market indices.
Despite the weekly downturn, the NGX All-Share Index has maintained a year-to-date gain of 35.03%. This overall positive year-to-date performance suggests underlying strength in the Nigerian market, driven by continued investor interest in fundamentally sound companies across key sectors, particularly banking, insurance, and consumer goods. This sustained interest indicates a degree of optimism about the long-term prospects of these sectors, despite the short-term volatility observed during the week in question. While macroeconomic concerns remain a factor, the year-to-date gains suggest that investors continue to see value and growth potential in the Nigerian market.
