The Nigerian stock market experienced a downturn on Tuesday, continuing a bearish trend from the previous day. The All-Share Index, a key indicator of market performance, fell by 0.4%, shedding 568.62 points to close at 140,929.60. This decline translated to a market capitalization loss of N322 billion, highlighting a significant retreat by investors from select equities. This negative trend extended the market’s losses over the past week and month, reaching 0.44% and 0.36% respectively. Despite these recent setbacks, the market maintained a substantial year-to-date gain of 36.92%, suggesting overall positive performance for the year.
Trading activity saw a mixed picture. While the volume of shares traded surged by 55% to 759,058,546 and turnover value increased significantly by 88% to N25.7 billion compared to the previous session, the number of deals actually decreased by 17%. This suggests that while overall trading activity increased, the decline in the number of deals points to a more concentrated investment approach, with fewer but larger transactions taking place. This could indicate larger investors making strategic moves rather than broad-based retail investor participation. The market dynamics suggest a selective approach by investors, focusing on specific stocks rather than engaging in widespread buying or selling.
The performance of individual stocks varied considerably. Of the 128 equities traded, a small fraction, just 16, registered gains, while a larger group of 35 experienced declines, further emphasizing the prevailing bearish sentiment. Thomas Wyatt Nigeria led the gainers with a near 10% increase, closing at N2.80 per share. Other notable gainers included Chellarams, RT Briscoe, and Custodian and Allied, all posting gains exceeding 9%. These gains, however, were overshadowed by the losses experienced by several other companies.
Dangote Sugar Refinery suffered the most significant loss, plummeting by 10% to close at N54.00 per share. Wema Bank and Secure Electronic Technology also experienced substantial declines, shedding 8.27% and 6.25% respectively. Major players like Access Holdings and Aradel also contributed to the negative trend, falling by 4.98% and 4.76% respectively. The losses in these high-profile stocks likely contributed significantly to the overall market decline. This divergence in individual stock performance further underscores the selective nature of investor activity during the trading session.
Trading volume was dominated by Consolidated Hallmark Holdings, exchanging 170 million shares, followed by Zenith Bank with 104 million shares. First HoldCo and Fidelity Bank also saw significant trading activity, exchanging 101 million and 52.5 million shares respectively. While volume reveals the number of shares traded, the value of these transactions provides a different perspective on market activity. Zenith Bank led in terms of value, recording transactions worth N6.91 billion. Guaranty Trust Holding Company Plc followed with N4.12 billion, First HoldCo with N3.15 billion, MTN with N1.61 billion, and Presco with N1.24 billion. This data highlights the concentration of value in a few key stocks, reflecting investor preference for these companies despite the overall market downturn.
Broader market indices mirrored the negative trend observed in the All-Share Index. The Top 30 Index, representing the performance of the 30 most capitalized companies, declined by 0.47%. Similarly, the Main Board Index and the Industrial Index also fell by 0.47% and 0.6% respectively. The Consumer Goods Index experienced a marginal decline of 0.11%, while the Premium Index and the Pension Index shed 0.28% and 0.72% respectively. These declines across various sectors suggest a broad-based negative sentiment affecting the Nigerian stock market. The decline in the Pension Index, in particular, may indicate a more cautious approach by institutional investors.
The bearish trend observed on Tuesday followed a similar pattern from the previous day, where the market experienced a N220 billion loss, attributed to declines in major stocks like Nigerian Breweries. This sustained downturn indicates a prevailing negative sentiment among investors, likely influenced by factors such as uncertainty in the consumer and industrial goods sectors. The consecutive days of losses suggest a potential trend and warrant further analysis to understand the underlying drivers and potential implications for the Nigerian economy. The bearish trend also raises questions about the sustainability of the year-to-date gains and whether the market can recover from this recent downturn.
