NSE Depreciates by 2.35% Last Week as COVID-19 Spreads

• NSE Depreciates by 2.35% Last Week as COVID-19 Spreads

The Nigerian Stock Exchange (NSE) depreciated further last week as market sentiment remains largely negative on the back of fast-spreading COVID-19.

The market capitalisation of listed equities declined by N278 billion from N11.846 trillion recorded in the previous week to N11.568 trillion last week.

NSE All-Share index dipped by 2.35 percent or 534.92 basis points from 22,733.35 bps it closed in the previous week to 22,198.43 bps last week. Bringing the year-to-date decline to 17.30 percent and total decline in the month of March stood at 15.33 percent at the end of the week.

The rising number of coronavirus infected people in the country weighed on the nation’s business activity as more businesses and investors continue to shut down operations to curb the spread of the virus.

Schools, religious centres and other public gatherings like the mall have been shut down in Lagos, the commercial centre of the nation, as directed by the president to compel people to stay at home as Africa’s largest economy battles a global pandemic.

On Friday, the Central Bank of Nigeria technically devalued the Naira against the U.S dollar by lowering the official foreign exchange rate of the local currency from N307 per dollar to N360/$1 to preserve the declining foreign reserves.

Although the central bank denied devaluing the Nigerian Naira, it claimed the new foreign exchange rate was an adjustment to accommodate the change in macro fundamentals as stated on Investors King on Friday.  It was clear the apex bank could no longer sustain the Naira exchange rate at N306/$1 given current economic macros.

Last week, 35 stocks closed in the red, up from the 2 recorded a week earlier. Also, 27 stocks closed in the red, lower than the 64 filed a week ago.

Total shares of 2.804 billion valued at N32.559 billion were exchanged in 31,715 transactions during the week compared to a week earlier when 3.964 billion shares worth N43.703 billion were traded in 26,054 deals.

In terms of volume traded, the financial services sector led with 2.508 billion shares valued at N25.292 billion shares exchanged in 23,243 transactions. This was followed by the conglomerates sector with 60.873 million shares valued at N105.948 million but traded in 767 transactions.

The services sector came third with a total turnover of 51.296 million shares valued at N117.545 million in 350 deals.

Zenith Bank Plc, Guaranty Trust Bank Plc and FBN Holdings led the most traded stocks by volume with a combined share of 1.635 billion valued at N21.282 billion in 15,631 deals.