The Nigerian Stock Market dipped last week as the Central Bank of Nigeria (CBN) implemented further tightening measures to address rising inflation.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation both depreciated by 0.52% to close the week at 97,612.51 points and N55.218 trillion, respectively.

This decline in the market coincided with the Monetary Policy Committee (MPC) of the CBN’s decision to hike the policy rate by 150 basis points (bps) to 26.25%.

The committee also retained the cash reserve ratio (CRR) for deposit money banks at 45%, the asymmetric corridor at +100bps/-300bps, and the liquidity ratio at 30%.

“The market remains under pressure as investors pursue safety in the fixed income space. However, given the strong sell-side action in the banking space, we anticipate some buy-side action in the coming week as traders seek to take advantage of some stocks that have been beaten down in recent sessions,” noted analysts from Lagos-based Vetiva Research in their May 24 report.

Despite the overall market downturn, certain sectors showed resilience.

Indices such as NGX MERI Value, NGX Consumer Goods, NGX Oil and Gas, NGX Lotus II, and NGX Industrial Goods saw gains of 1.74%, 0.31%, 0.72%, 0.44%, and 0.19%, respectively.

The NGX ASeM index, however, closed flat.

A closer look at the week’s trading activities revealed that twenty-four equities appreciated in price, down from twenty-eight in the previous week.

Conversely, fifty-three equities saw a decline in price, an increase from fifty-one in the preceding week, while seventy-seven equities remained unchanged, slightly up from seventy-six.

The financial services industry led the trading activity with 1.577 billion shares valued at N30.359 billion traded in 20,697 deals, accounting for 79.41% and 74.56% of the total equity turnover volume and value, respectively.

The conglomerates industry followed with 125.342 million shares worth N1.387 billion in 2,283 deals.

The consumer goods industry also recorded significant activity, with a turnover of 77.327 million shares worth N2.446 billion in 4,916 deals.

Among individual equities, Ecobank Transnational Incorporated Plc, Access Holdings Plc, and United Bank for Africa Plc were the top three in terms of trading volume, accounting for 1.006 billion shares worth N20.115 billion in 6,849 deals.

This represented 50.67% and 49.40% of the total equity turnover volume and value, respectively.

Also, 5,340 units of exchange-traded products valued at N2.350 million were traded in 111 deals, compared to 4,103 units valued at N2.429 million in 110 deals the previous week.

The bond market also saw significant activity, with 82,778 units valued at N80.570 million traded in 18 deals, compared to 9,282 units valued at N8.945 million traded in 24 deals the preceding week.

The MPC’s decision to raise interest rates is part of a broader strategy to rein in inflation and stabilize the economy.

However, the immediate impact on the stock market has been negative, as investors seek safer investments in the fixed income space.

Market participants will be closely watching the coming weeks for potential buy-side opportunities and further economic indicators that could influence trading strategies.

As the Nigerian stock market navigates these turbulent times, the actions of the CBN and global economic conditions will continue to play pivotal roles in shaping market dynamics.

Investors are advised to stay informed and consider the long-term implications of these policy decisions on their portfolios.

In yet another day of bearish activity, the Nigerian stock market dipped as the All-Share Index fell to 97,978.02 basis points.

The decline, underpinned by losses recorded in key stocks such as Skyway Aviation Handling, NEM Insurance, and others, amounted to a loss of N84 billion in market capitalization.

The trading session saw the prevalence of bearish sentiment with more decliners (28) than gainers (17) on the Nigerian Exchange.

Skyway Aviation Handling led the pack of losers, experiencing a significant 9.80% decline to close at N20.70 per share. Following closely, NEM Insurance stocks shed 9.47% to close at N7.65, while FTNCocoa lost 9.35% to close at N1.26 per share.

The overall market performance reflected a 0.15% decrease, with the market capitalization also declining by 0.15% to N55.424 trillion.

Despite the downward trend, there was a marginal increase in the number of deals, growing by 6.35% to 7,852, while the trading volume surged by 16.5% to 316.453 million traded shares.

United Bank for Africa (UBA) led the volume chart with 50,316,438 units traded in 788 deals, while Julius Berger emerged as the most traded security by value, amounting to N1.47 billion in 303 deals.

Sectoral performance varied, with three out of five sectors ending in the red zone. The banking sector fell by 1.42%, while the consumer goods sector experienced a slight decline of 0.05%.

However, the oil and gas sector managed to gain 0.72%, and the industrial goods sector remained unchanged.

The recent downturn in the Nigerian stock market follows a series of losses, indicating sustained bearish sentiment among investors.

Concerns over inflation, energy prices, and exchange rate instability continue to weigh on market sentiment, prompting cautious trading activities.

While some sectors managed to record gains, overall market performance remains subdued, reflecting the prevailing economic challenges.

Investors are closely monitoring developments in both local and global markets for signals of potential market recovery or further downturns.

The Nigerian equity market dipped by N89 billion on Wednesday following the Central Bank of Nigeria’s decision to hike interest rates.

Both the all-share index and market capitalization plunged by 0.16 percent to 98,128.00 basis points and N55.509 trillion, respectively.

This downturn caused the market’s year-to-date return to moderate to 31.23 percent, reflecting the impact of the MPC’s decision on investor sentiment.

Among the top gainers at the close of trading were Tantaliser, Wapic, Omatek, Julius Berger, and Wapco. Conversely, TIP, Multiverse, Cornerst, and Deapcap led the laggards, showcasing the uneven performance across different sectors.

Accesscorp emerged as the most traded stock by volume, with 35.57 million units traded in 606 deals, while GTCO took the lead as the most traded security by value, amounting to N1.35 billion in 403 deals.

The market’s sectoral performance was also mixed, with two out of five sectors closing positively, two closing negatively, and one remaining flat.

The banking and insurance sectors experienced losses of 2.01 percent and 0.87 percent, respectively, due to portfolio rebalancing by investors following the MPC’s decision.

In contrast, the oil and gas sector remained unchanged, while the industrial and consumer goods sectors saw marginal increases of 0.18 percent and 0.02 percent, respectively.

Analysts from Meristem expressed their outlook, anticipating continued lackluster sentiment in the equities market following the MPC’s contractionary stance.

However, they also expect buying interest to surface in stocks trading at attractive entry points, particularly as the sell-off pressure in the banking sector is projected to ease in the near term.

The market’s reaction underscores the sensitivity of investors to monetary policy decisions and highlights the importance of closely monitoring regulatory actions for their impact on market dynamics and investment strategies.