The Nigerian equities market extended its bearish momentum into the fourth consecutive week as sustained investor apathy and macroeconomic concerns dragged the NGX All-Share Index (ASI) below the psychological 105,000-point threshold.
At the close of trading last Friday, the ASI declined by 2.7 percent to settle at 104,962.96 points, shedding 2,858.43 points from the previous week’s close of 107,821.39 points.
Market capitalisation also fell in tandem, losing N1.374 trillion to close at N65.819 trillion, down from N67.193 trillion as of February 28.
The persistent negative sentiment pushed the year-to-date (YTD) gain down to 2 percent as month-to-date (MTD) performance turned negative at -2.7 percent.
The downturn came despite a second consecutive decline in inflation, as indicated by the Consumer Price Index (CPI) report for February 2025.
However, the positive macroeconomic signal failed to lift market confidence as investors remained cautious due to prevailing uncertainties surrounding monetary policy, volatile foreign exchange rates and weak global market sentiment.
The total volume of shares traded during the week declined by 11.5 percent to 2.90 billion units, while the value of transactions dropped by 24.3 percent to N48.06 billion.
Sectoral performance showed widespread losses across major indices. The NGX Industrial Goods Index posted the steepest decline at 3.39 percent, driven by heavy selloffs in stocks such as BUA Cement, Cutix Plc, and UPDCREIT.
The NGX Insurance Index and NGX Banking Index declined by 2.8 percent and 2.5 percent respectively, as financial stocks including Universal Insurance, Sovereign Trust Insurance, FCMB Group, AccessCorp and FirstBank HoldCo recorded significant losses.
The energy sector also closed in negative territory, with the NGX Oil and Gas Index falling by 1.08 percent, while the NGX Commodity Index dipped 0.45 percent.
The NGX Consumer Goods Index was the sole gainer, advancing marginally by 0.06 percent due to renewed interest in select stocks such as Neimeth, Northern Nigeria Flour Mills (NNFM), NASCON Allied Industries, and Dangote Sugar.
According to analysts at Cowry Asset Management, the current market pullback may present attractive entry points for long-term investors.
“The prevailing market conditions indicate that the market is currently oversold, presenting a potential entry point for discerning investors. Dividend-paying stocks are becoming increasingly attractive, as their yields are likely to improve in response to recent price declines,” the firm stated.
As March trading nears its end, some market participants are expected to begin repositioning ahead of the upcoming dividend season, which traditionally provides opportunities for both capital gains and income.
However, analysts at Cordros Capital warned that near-term volatility will likely persist as investors digest a wave of full-year corporate earnings and dividend announcements.
They noted that the market’s direction in the coming weeks will depend heavily on the quality of earnings releases, policy signals from the Central Bank of Nigeria (CBN), and developments in the broader macroeconomic environment.
With the NGX now trading at oversold levels, analysts advise a cautious but strategic approach to stock selection, favouring companies with resilient earnings, sound fundamentals, and consistent dividend history.
For now, the equities market remains fragile, with investor sentiment tethered to both local and external economic cues.
