Large-cap Stocks Drag Equities to N189b Loss

• Large-cap Stocks Drag Equities to N189b Loss

After a momentary recovery on Tuesday, Nigerian equities suffered a major decline yesterday as foreign portfolio investors led massive selloffs in stock market’s largest companies. Benchmark indices at the Nigerian Stock Exchange (NSE) showed an average decline of 1.49 per cent, equivalent to net capital depreciation of N189 billion.

This slump worsened the average year-to-date return to -10.01 per cent. Quoted equities had so far this month lost an average of 1.25 per cent.

With 26 losers to 20 gainers, the negative overall market position was due to widespread losses, especially losses recorded by large-cap stocks such as Dangote Cement, Guaranty Trust Bank, Seplat Petroleum Development Company and Zenith Bank Plc.

All indices closed in the negative with the exception of the NSE Consumer Goods Index, which inched up by 0.3 per cent. The NSE Oil & Gas Index declined by 3.2 per cent. The NSE Industrial Goods Index dropped by 2.3 per cent. The NSE Insurance Index depreciated by 1.6 per cent while the NSE banking Index dipped by 1.2 per cent.

“Going forward, we believe market performance will remain largely bearish as sentiments remain soft,” Afrinvest Securities stated.

Seplat Petroleum Development Company, NSE’s second highest-priced stock, led the losers with a loss of N47 to close at N603. Dangote Cement, Nigeria’s largest quoted company, followed with a loss of N7 to close at N223. Stanbic IBTC Holdings dropped by N1 to close at N47. Flour Mills of Nigeria lost 80 kobo to close at N21.20. Ecobank Transnational Incorporated, Lafarge Africa and Zenith Bank dropped by 45 kobo each to close at N19.55, N23.05 and N21.45 respectively while Guaranty Trust Bank, Nigeria’s largest financial institution, declined by 40 kobo to close at N36.65 per share.

On the positive side, Forte Oil and International Breweries led the gainers with a gain of N1 each to close at N20 and N33 respectively. Nigerian Breweries rose by 50 kobo to close at N93.50. C & I Leasing added 27 kobo to close at N2.99 while Fidson Healthcare and Oando chalked up 10 kobo each to close at N5.50 and N5.30 respectively.

Total turnover stood at 200.28 million shares valued at N2.16 billion in 3,224 deals. United Bank for Africa led the activities chart with 22.48 million shares valued at N180.35 million. Stanbic IBTC Holdings followed with 19.24 million shares valued at N904.44 million while FCMB Group placed third with 19.13 million shares worth N34.93 million.

“We guide investors to trade cautiously in the short to medium, as selloffs are likely to persist, amidst the absence of a one-off positive trigger, as well as likely negative sentiments of investors, particularly foreign players, as a result of contagion effect of emerging market selloffs, and political concerns ahead of the 2019 election,” Cordros Capital stated.