The Nigerian equity market closed in the red on Tuesday as the benchmark index plummeted to levels last seen in January.
The All-Share Index (ASI) dropped to 97,473.98 points, mirroring the bearish sentiment that prevailed earlier in the year.
Similarly, the market capitalization of listed stocks also experienced a sharp decline, falling to N55.132 trillion, a level reminiscent of the market’s performance in January when it reached N55.583 trillion.
This decline marks a stark reversal from the bullish trend that characterized the latter part of 2023 and spilled over into the early months of 2024.
Analysts had long anticipated a correction in the market, citing the unsustainable nature of the rally driven largely by sentiment rather than fundamental economic or market improvements.
David Adonri, a seasoned stockbroker, described the previous bullish run as sentiment-driven, noting that while the equities market had recorded impressive gains of 39.84 percent in the first quarter of 2024, it lacked substantial support from economic or market fundamentals.
Despite efforts to reignite investor interest through corporate actions and announcements, such as the Central Bank of Nigeria’s plans for a recapitalization exercise, the market struggled to maintain momentum.
Other investment avenues offering better yields further diverted attention away from equities.
The day’s trading session saw notable declines in the share prices of key players such as Dangote Sugar and PZ Cussons, both recording a 10 per cent drop, extending their stay on the losers’ chart.
The Initiates Plc, a waste management firm, also witnessed a similar decline in its share price.
Trading activities painted a gloomy picture as total deals, volume, and value all depreciated significantly compared to the previous day.
Sectoral performance reflected the overall bearish sentiment with declines observed in banking, insurance, and consumer goods indices.
While the industrial goods index saw a marginal rise, the oil and gas sector remained stable amidst the turmoil.
AccessCorp emerged as the most traded security by volume, while GTCO led in traded value, highlighting investor interest in specific stocks despite the market-wide downturn.