The Nigerian Exchange Limited (NGX) lost N345 billion on Tuesday as Transcorp, Dangote Sugar, and Eterna closed in the red.
The NGX All-Share Index (ASI) fell by 0.51% to close at 106,904.25 points, down from the previous day’s 107,455.13 points while the equities market capitalization decreased to N66.942 trillion from N67.287 trillion.
The downturn pushed the market’s year-to-date (YtD) return to +3.86% and the week-to-date loss also widened to 0.85%.
The decline was led by Transcorp, Eterna and Dangote Sugar as they shed 10% each.
Eterna’s share price dropped from N42 to N37.80, wiping off N4.20 per share. Similarly, Dangote Sugar lost N4 from N40 per share to N36 per share while Transcorp retreated from N57 to N51.30.
The sell-off extended to other actively traded stocks, with United Capital, Ellah Lakes, Zenith Bank, Universal Insurance and Access Holdings experiencing varying degrees of declines.
In total, investors exchanged 395,466,683 shares worth N8.763 billion across 13,967 deals, reflecting a cautious sentiment among market participants.
Analysts attributed the losses to a combination of profit-taking and prevailing uncertainties in the macroeconomic environment. Rising inflation, a volatile foreign exchange market, and concerns over fiscal and monetary policies have continued to weigh on investor confidence.
“The recent downturn is not unexpected given the prevailing macroeconomic pressures and the fact that many stocks were approaching overbought levels,” said a market analyst at Cordros Securities. “Investors are also reacting to uncertainties around monetary policies and the fiscal outlook.”
The energy sector bore the brunt of the decline with Eterna’s 10% loss highlighting the sector’s vulnerability amid fluctuating oil prices and operational challenges.
Similarly, the consumer goods segment witnessed significant pressure, driven by Dangote Sugar’s sharp drop, which analysts linked to concerns over input cost inflation and foreign exchange volatility.
Transcorp’s decline also raised eyebrows, given the company’s recent efforts to diversify its revenue streams and improve operational efficiency. Market observers suggested that the sell-off could be a result of investors booking profits following a strong rally in previous sessions.
Despite the market’s downward trend, a few counters managed to buck the sell-off. Access Holdings and Zenith Bank recorded marginal gains amid renewed interest in banking stocks, which have been seen as defensive plays in the current market environment.
Looking ahead, analysts suggest that the market may experience further volatility in the short term, particularly as investors assess the impact of the Central Bank of Nigeria’s (CBN) monetary policy stance and the broader economic outlook.
“As we approach the end of the first quarter, market participants are likely to remain cautious, focusing on sectors with strong fundamentals and defensive characteristics,” noted an analyst at United Capital.
