Stock market investors lost N623bn last week as fund managers rebalanced their portfolios ahead of the first quarter results.
The Nigerian capital market shed 1.08 per cent to 103,437.67 points, while the market capital dipped by 1.05 per cent to close last week at N58.5tn.
According to analysts, the market trend was influenced by the actions of market players who continue to digest the corporate earnings released so far as well as portfolio rebalancing efforts on the strength of expected earnings for the first quarter of 2024.
The market saw increased trading activities as investors exchanged 3.68 billion units of shares worth N57.89bn in 40,726 deals, compared to 1.80 billion units valued at N52.04bn traded in 38,550 deals in the previous week.
The upward movement is attributable to the prominence of window dressing activities by fund managers on the strength of expectations for the first quarter scorecards.
All indices finished lower except for consumer goods and growth, which appreciated by 0.94 per cent and 0.32 per cent, respectively.
Adverse price movements in May &Baker, Dangote Sugar and Ikeja Hotel contributed to the positive run in the consumer goods index.
Conversely, the banking index dropped by 6.73 per cent week-on-week, on the back of adverse price movements in the bellwether banking stocks.
Also, the insurance and industrial goods sectors closed negative from the previous week’s close by 0.85 per cent, and 0.27 per cent, respectively. The downbeat trajectory was linked to the downward pricing of FBN Holding, Sterling Financial Holdings, Julius Berger, Guaranty Trust Holding Company, Prestige, etc.
Meanwhile, the oil & gas sector closed the week on a relatively muted note compared to the previous week.
The financial services industry (measured by volume) led the activity chart with 2.881 billion shares valued at N46.201bn traded in 21,257 deals, contributing 78.29 per cent and 79.81 per cent to the total equity turnover volume and value respectively.
The services industry followed with 479.156 million shares worth N2.282bn in 2,142 deals.
In third place was the conglomerate industry, with a turnover of 123.59 million shares worth N1.65bn in 2,849 deals.
The top three equities traded during the week in volume terms were Abbey Mortgage Bank, Tourist Company of Nigeria and Zenith Bank, accounting for 2.175 billion shares worth N20.667bn in 2,594 deals, contributing 59.10 per cent and 35.70 per cent to the total equity turnover volume and value, respectively.
Commenting on the market trend and projection for the second quarter, investment banker and stockbroker, Tajudeen Olayinka, said, “The market had a good showing in Q1 2024, with most of the good performances recorded between January and February 2024.
“Even though March 2024 had a positive performance for the index, it was a period of major socioeconomic disruptions and profit-taking, as investors struggled hard to deal with high inflation and negative real returns in the fixed-income market, which necessitated the issuance of Treasury Bills at the above 20 per cent effective yield for one-year maturities by DMO. The industrial goods and consumer goods sectors outperformed the market in Q1 2024.”
According to Olayinka, the market is likely to witness a robust performance in Q2 2024, as CBN continues to stabilise the exchange rate of the naira with inflows from foreign portfolio investors and Diaspora remittances.
