Emmanuel OchayiEquity Market Suffers Continued Decline
Nigeria’s equity market continued its downward trend on Thursday, dropping by 0.12 percent as investor sentiment weakened.
The market saw significant sell pressure, particularly in key stocks like Transcorp Hotels Plc, which led to notable declines.
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Transcorp Hotels Plc experienced a significant drop in its share price, falling by N10 or 10 percent, moving from N100 to N90.
The sell-off in Transcorp Hotels set the tone for the day, with other stocks following suit. Eterna Plc was another major laggard, as its share price fell from N22 to N19.90, losing N2.10 or 9.55 percent.
Ikeja Hotel Plc also saw a decline, dropping from N7.70 to N7, a loss of 70 kobo or 9.09 percent.
Chams Plc wasn’t spared either, as it decreased from N2.16 to N1.95, losing 21 kobo or 9.72 percent. These declines contributed significantly to the overall drop in the equity market.
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Most Traded Stocks
The equity market also witnessed high trading volumes in shares of companies like Universal Insurance, Chams, Oando, Transcorp, and Access Holdings.
Traders in 8,243 deals exchanged 393,620,711 shares worth N5.853 billion. Despite the high activity, the overall market sentiment remained bearish.
Weekly and Monthly Market Performance
The week has been tough for the equity market, with a 1.42 percent decline.
Every month, the market has dropped by 1.69 percent. These declines have pushed the market’s year-to-date (YtD) return down to 28.01 percent, indicating a challenging period for investors.
Analysts’ Outlook on the Equity Market
Looking ahead, analysts from Lagos-based Vetiva provided a cautious outlook. “The market outlook for tomorrow leans towards a cautious and potentially bearish trend, with limited upside unless a positive catalyst emerges,” they noted in their August 21 report.
They added, “Investors may continue to adopt a wait-and-see approach, with selective buying in stocks showing resilience.”
This perspective reflects the broader sentiment across the equity market, where investors are wary of further declines and are waiting for positive developments that could turn the tide.
NGX All-Share Index and Market Capitalization
The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalization reflected the market’s overall downturn.
The ASI decreased from the previous day’s 95,831.51 points to 95,718.05 points. Similarly, Market Capitalization dropped from N55.047 trillion to N54.982 trillion.
Caution Prevails
As the equity market continues to face downward pressure, investors are likely to remain cautious.
The significant declines in key stocks and the overall bearish sentiment suggest that the market may need a strong positive catalyst to reverse its current trajectory.
Until then, the focus for many investors will likely remain on managing risk and seeking out resilient stocks that can weather the storm.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
