Nigeria’s equity market decreased by 0.69 percent on Tuesday. Driven majorly by increased sell pressure in stocks like NGX Group Plc, Zenith Bank Plc, NPF Microfinance Bank Plc and Livestock Feeds Plc, the stock lost about N187 billion.
NGX Group was the most affected after its share price dropped from N21 to N20, down by N1 or 4.76percent.
This was followed by Zenith Bank Plc which dropped from N21 to N20.25, down by 75 kobo or 3.57 percent; while NPF Microfinance Bank Plc dipped from N1.66 to N1.53, losing 13 kobo or 7.83 percent.
Sterling Bank, Transcorp, Zenith Bank, GTCO and UBA were the most traded stocks as investors in 4,247 deals exchanged 138,991,046 shares valued at N2.725 billion.
The market’s All-Share Index (ASI) and capitalisation decreased further on Tuesday from the preceding day’s highs of 49,991.41 points and N26.964 trillion respectively to 49,644.92 points and N26.777 trillion.
These drops are a continuation of the wider equity sell-off because of the uncertainty in the market.
Reacting to this mixed development, an analyst at PAC Holdings, Wole Adeyeye, said some investors migrated from the stock market to the fixed-income market in a move to take advantage of high yields, which was triggered by the recent hike in policy rate.
He stated further that “ foreign investors avoided the Nigerian stock market due to the upcoming general elections, weak local currency and insecurity in the country.”
While this trend may likely continue for a couple of months because of the attractiveness of the fixed income market which is expected to remain relatively high and the uncertainty surrounding the economy which has created a degree of fear for investors, the long-term outlook of the equity market looks positive.
