Emmanuel OchayiThe Nigerian equity market closed negative on Thursday, reflecting a 0.05% decrease. This drop followed Wednesday’s decline, pushing the year-to-date (YTD) negative return further to 0.13%.
Vetiva Research analysts commented on the market performance, stating, “We foresee no catalyst on the horizon that could drive a tangible shift to the risk-off sentiment currently gripping the market.”
Join our WhatsApp ChannelThe analysts had earlier anticipated a mixed session as financial year 2024 (FY24) earnings reports trickled in.
Investor Activity and Key Trades
At the close of trading, investors carried out 12,160 deals, exchanging 394.36 million shares valued at N22.78 billion. Among the most actively traded stocks were GTCO, Zenith Bank, Access Holdings, UBA, and Jaiz Bank.
A trader, Chijioke Okafor, explained, “The market remains under pressure as investors are cautious. We’re seeing limited activity in the large-cap stocks because many are waiting for clearer economic signals.”
Decline in Market Indices
The Nigerian Exchange Limited (NGX) All-Share Index (ASI) fell to 102,788.2 points, while the equities market capitalisation dropped to N63.147 trillion.
Morison Industries led the decliners, dropping from N4.01 to N3.61—a loss of 40 kobo or 9.98%. Similarly, C&I Leasing dropped from N4.34 to N3.91, shedding 43 kobo or 9.91%.
Speaking on the decline, market analyst Sarah Adebayo remarked, “The performance reflects investors’ focus on the macroeconomic environment. Without strong positive triggers, the market is unlikely to sustain growth.”
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Top Losers and Market Sentiment
Other significant decliners included Ikeja Hotel, which fell from N13.50 to N12.30, losing N1.20 or 8.89%, and Neimeth, which dropped from N3.76 to N3.44, shedding 32 kobo or 8.51%. Sunu Assurance also declined, moving from N5.98 to N5.50, a loss of 48 kobo or 8.03%.
An anonymous portfolio manager shared, “Investors are being selective, focusing on sectors with strong fundamentals. The banks are still the most active, but even there, volumes are cautious.”
Weekly Performance
Despite Thursday’s decline, the market had recorded a weekly gain of 0.42%. However, traders and analysts remained skeptical about sustained growth, citing a lack of catalysts to shift market sentiment positively.
A trader at NGX stated, “It’s been a tough week overall. Even though there’s a slight uptick for the week, the sentiment isn’t optimistic. Most investors are still risk-averse.”
Outlook for the Equity Market
As FY24 earnings reports continue to come in, analysts suggest that market performance in the coming weeks will depend largely on corporate results and broader economic indicators.
Vetiva Research analysts concluded, “Unless there is a significant improvement in the macroeconomic environment or a major fiscal policy announcement, the market is likely to remain subdued.”
The equity market will need strong external triggers to reverse the prevailing cautious sentiment among investors. Until then, the current trends might persist.
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.
