Nigerian equities closed at the weekend with a net capital depreciation of N416 billion as low demand amid profit-taking transactions left most quoted equities at lower prices.
Investors took flight to safety to the banking sector, with increased demand for top-tier banking stocks.
Benchmark index for the Nigerian stock market, the All Share Index of the Nigerian Exchange Limited, indicated an average decline of 1.60 per cent at the weekend.
The steep decline during the week pushed the negative average year-to-date return for Nigerian equities to -2.66 per cent.
Against the background of the negative market position, increased demand for leading banking stocks drove the benchmark index for the banking sector up by 0.62 per cent.
Transactions in three tier 1 banks – Access Bank Plc, FBN Holdings Plc and Zenith Bank Plc – accounted for nearly half of the total turnover for the week.
Analysts were dividend on immediate to short-term outlook for Nigerian equities as investors weigh returns in the fixed-income market against the risks of publicly quoted shares.
While some analysts expected a rebound in the days ahead on the back of bargain-hunting, others said there were no strong triggers to drive broad price appreciation in the immediate period.
The ASI closed at the weekend at 39,198.75 points as against its week’s opening index of 39,834.42 points. Aggregate market value of all quoted equities at the NGX depreciated from the week’s opening value of N20.847 trillion to close weekend at N20.431 trillion.
The overall decline was exacerbated by the voluntary delisting of a major downstream oil and gas company, 11 Plc, at the weekend.
Adjusted for the delisting, net depreciation due to share prices movements stood at about N333.6 billion.
Also, at the NASD OTC Securities Exchange, the over-the-counter platform for trading in unlisted public securities, the NASD OTC Securities Exchange Index declined by 1.50 per cent to close the weekend at 778.03 points as against the week’s opening index of 789.89 points.
Investors at the NASD lost N8.43 billion as the NASD OTC market capitalisation droped from its opening value of N561.46 billion to close weekend at N553.03 billion.
Analysis of share price movements at the NGX showed that the negative overall market position was largely driven by selloffs among large-cap stocks, especially in the highly influential industrial goods sector.
Total turnover at the NGX during the four-day trading week stood at 1.419 billion shares worth N15.918 billion in 18,459 deals as against a total of 1.441 billion shares valued at N10.883 billion in 19,614 deals recorded in the previous week.
The bank-led financial services sector remained the most active with a turnover of 1.069 billion shares valued at N9.531 billion traded in 10,907 deals; thus contributing 75.34 per cent and 59.88 per cent to the total equity turnover volume and value.