Stock Market Records Decline in Investors’ Participation

• Stock Market Records Decline in Investors’ Participation

The nation’s stock market saw a reduction in the participation of investors last week.

The market, which gained N36bn last week, compared to the N325bn loss of the previous week, saw a decline in market participation as volume and value of trade dropped by 31.42 per cent and 39.46 per cent, respectively.

The All Share Index advanced by 0.31 per cent to settle at 32,049.73 basis points, thereby pegging the year-to-date return at 1.57 per cent.

Market breadth settled lower at 0.65x as the market recorded 23 gainers and 37 losers.

In the course of the week, Guaranty Trust Bank Plc, Stanbic IBTC Holdings Plc, Nestlé Nigeria Plc and Seplat Petroleum Development Company Plc released their 2018 financial year results.

Analysts at Meristem Securities Limited said the activities were buoyed by the release of companies’ results, which showed positive performance and the attractive dividend payment proposed by the firms.

They said, “Also, with the presidential elections already held, the political uncertainty in the system moderated. Consequently, buying pressures prevailed as investors sought to take a position, owing to the low valuation of counters across the market.”

Analysts at Vetiva Capital Management Limited said the mixed trading in the equities market was driven by investor apathy, which prevailed from midweek to week close.

Interests in the banking sector drove positive activity last Monday, with the ASI rising by 95bps. Positive activity continued on Tuesday, but at a weaker level, as the market climbed 14bps higher.

However, by Wednesday, sentiment had turned tepid, with sell-offs in the industrial goods and oil and gas sectors dragging the ASI to a -16bps close.

Sentiment remained tepid on Thursday despite the financial result released by GTB, which showed a four-per cent increase in top-line year-on-year, a 10 per cent increase in profit after tax and a dividend yield of 7.3 per cent.

Investors’ reaction to this and other earnings releases was muted as the ASI shed 22bps. Sentiment failed to improve at week close, with the consumer goods sector dragging the bourse on Friday.

However, buoyed by positive closes at the start of the week, the ASI ended the week 31bps higher.

The banking sector reversed its bearish course as it gained 3.37 per cent, improving its year-to-date return to 6.94 per cent.

Wema Bank Plc led the gainers’ table, advancing by 11.69 per cent to close at 86 kobo, while Sterling Bank Plc led the losers.

The consumer goods sector continued its bearish streak as it lost 0.98 per cent, dragging the year-to-date return to -1.11 per cent.

After a four-week bullish run, bearish investor sentiment returned to the insurance sector as its index dipped by 1.30 per cent, dragging its year-to-date return to 3.53 per cent.

The industrial goods sector gained 0.93 per cent during the week, recovering from losses recorded in the previous week to settle the year-to-date return at 3.12 per cent.

The oil and gas sector sustained its downturn from last week, dipping by 2.56 per cent. Consequently, the year-to-date return dragged further to settle at -3.44 per cent.

While there were no gainers in the oil and gas sector last week, four losers emerged, led by Japaul Oil and Maritime Services Plc.

“Following a tepid week driven by investor apathy and barring any political unrest, we foresee tepid activity, with the possibility of bargain-hunting. We also expect further earning releases drive a bit of interest in the equity market,” analysts at Vetiva said.