The reign of the bears continued unabated on the equities sector of the Nigerian Stock Exchange (NSE), as major highly capitalised stocks, especially Nestle and WAPCO depreciated in price, resulting in a further slide in market capitalisation by N68 billion.
Specifically, at the close of transactions yesterday, the All-share index plunged by 190.93 points from 41,686.36 to 41,495.43. Similarly, the market capitalization dipped by N68 billion to N14.912 trillion from N14.844 trillion recorded on Tuesday.
35 stocks constituted the losers’ chart, as Nestle emerged the day’s highest price loser with N30.00 kobo to close at N1350 per share while WAPCO followed with N3.30 kobo to close at N47.05 per share.
Stanbic IBTC lost N2.15 kobo to close at N46.00 per share. Cadbury shed N1.35 kobo to close at N12.65 per share. Nigerian Breweries depreciated by N1.20 kobo to close at N126.00 per share.
On the other hand, 19 stocks appreciated in price, led by Guinness with N4.80 kobo to close at N105.00 per share while GlaxoSmithKline followed with N1.05 kobo to close at N22.05 per share.
Dangote Flour appreciated by 75 kobo to close at N15.75 per share. Cement Company of Northern Nigeria advanced by 0.50 kobo to close at N18.75 per share. National Salt Company of Nigeria gained 0.50 kobo to close at N20.50 per share.
Analysts at Afrinvest Securities Limited attributed the drop in indices to profit taking and contagion effect of the rout in equities across global markets.
According to them, investors are currently taking profit in stocks that had rallied significantly before the beginning of the earnings season.
“The sell offs experienced in the local bourse so far can largely be attributed to profit taking in stocks that had rallied significantly before the beginning of the earnings season as well as contagion effect of the rout in equities across global markets.
“With investors sceptical of forward earnings vis-à-vis elevated valuations, sentiment has turned bearish in recent trading sessions. We believe declining level of valuation has presented investors with attractive entry opportunity; hence, we expect a reversal of the bearish trend in the near term.”
AFRINSURE dominated in volume terms with 82 million shares worth N20.4 million while Japaul oil followed with 75 million valued at N42 million. Fidelity bank accounted fot 63 million shares worth N151 million. Zenith bank accounted for 29 million shares worth N837 million.
FBN Holdings exchanged 28 million shares worth N344 million. In all, investors recorded 488 million shares worth N5.6 million in 5,524 deals, up from 409 million shares worth N3.9 billion that changed hands in 4,996 deals on Tuesday.
