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By Chinwendu Obienyi and Chukwuma Umeorah
Despite profit-taking activities on the floor of the Nigerian Exchange Limited (NGX), investors’ interest in Tier-1 bank stocks like UBA, FBN Holdings and Access Holdings Plc, played a significant role in driving increased turnover at the end of trading last week.
According to data obtained from NGX’s website, the aforementioned banks, which were the top performing equities by volume, accounted for 564.882 million shares worth N16.990 billion in 8,493 deals, contributing 32.56 per cent and 34.85 per cent to the total equity turnover volume and value respectively.
The market had resumed the week on a positive note but ultimately ended lower as investors opted to lock in profits on bellwether stocks following the recent run-up in share prices. Specifically, the All-Share Index (ASI) dipped by 0.42 per cent week-on-week (w/w) to close at 104,647.37 points, undermined by the loss in MTNN (-12.3 per cent) and PZ Cussons (10 per cent). Similarly, investors lost N247 billion as market capitalisation closed the week at N59.169 trillion from N59.416 trillion on resumption of trading.
Consequently, the Month-to-Date (MTD) and Year-to-Date (YTD) returns moderated to +4.7 per cent and +40.0 per cent, respectively. Across sectors, the Insurance (+8.9 per cent), Banking (+4.2 per cent), Industrial Goods (+0.6 per cent) and Oil and Gas (+0.3 per cent) posted gains while the Consumer Goods (-0.4 per cent) index declined.
However, activity level remained subdued as the total trading volume and value decreased by 2.1 per cent w/w and 7.8 per cent w/w, respectively. Further data of the market report revealed that a total turnover of 1.735 billion shares worth N48.755 billion in 45,237 deals was traded by investors on the floor of the Exchange, in contrast to a total of 1.773 billion shares valued at N52.867 billion that exchanged hands in the previous week in 44,713 deals.
The Financial Services Industry (measured by volume) led the activity chart with 1.273 billion shares valued at N31.077 billion traded in 23,066 deals; thus contributing 73.36 per cent and 63.74 per cent to the total equity turnover volume and value respectively.
The Conglomerates Industry followed with 123.237 million shares worth N1.772 billion in 3,205 deals while the Consumer Goods Industry recorded a turnover of 104.854 million shares worth N5.292 billion in 6,166 deals.
Reacting to the performance of the market, market operators noted that the increase in turnover suggests heightened trading activity, possibly influenced by profit-taking strategies.
They added that investors’ interest in fixed income instruments and envisage a cautious approach from investors who will be waiting for the outcome of the Monetary Policy Committee (MPC) meeting which is scheduled to hold this week.
“In the week ahead, we believe investors will be focused on the outcome of the MPC meeting scheduled to hold next week to gain further clarity on the movement of yields in the FI market. As a result, we envisage an extension of the cautious trading theme, especially from domestic investors”, they said.
