Stock Market Down N675bn on Profit-taking in Airtel Africa

The stock market of the Nigerian Exchange Limited (NGX) continued its decline for the fourth consecutive week as massive sell-offs in Airtel Africa Plc heaped down performance in the market.

The profit-taking led to market capitalisation dropping by N675 billion to N28.869 trillion as the NGX All-Share Index plummet by 2.28 per cent week-on-week (W-o-W) to close at 52,994.13 basis points.

Across the sectors last week, performance was largely on a bear trend across the indices under our purview except for the NGX Insurance index which gained 2.09 per cent week on week from buy interest.

On the other hand, the Industrial index led the losers with 3.65 per cent loss week on week, while the NGX Banking index, NGX Consumer Goods index and NGX Oil & Gas index all traded southward to close the week by 1.05 per cent, 0.62 per cent and 0.11 per cent from the previous week.

The market breadth for the week was negative as 16 equities appreciated in price, 37 equities depreciated in price, while 103 equities remained unchanged. Nigerian Aviation Handling Company led the gainers table by 20.99 per cent to close at N9.80, per share. AXA Mansard Insurance followed with a gain of 15.79 per cent to close at N2.20, while CWG went up by 14.94 per cent to close to N1.00, per share.

On the other side, Eterna led the decliners table by 19.12 per cent to close at N5.50, per share. Multiverse Mining and Exploration followed with a loss of 18.83 per cent to close at N2.63, while Associated Bus Company declined by 16.22 per cent to close at 31 kobo, per share.

Overall, a total turnover of 1.054 billion shares worth N10.050 billion in 16,155 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 2.071 billion shares valued at N17.562 billion that exchanged hands previous week in 17,917 deals.

The Financial Services Industry (measured by volume) led the activity chart with 630.378 million shares valued at N5.438 billion traded in 7,705 deals; thus contributing 59.83 per cent and 54.11 per cent to the total equity turnover volume and value respectively. The Conglomerates Industry followed with 248.074 million shares worth N394.370 million in 812 deals, while the Oil and Gas Industry traded a turnover of 70.921 million shares worth N1.345 billion in 1,452 deals.

On the market performance this week, analysts expected the stock market to maintained downtrend this week on continuous sell pressure.

The market opened for four trading days last week as the federal government declared Friday April 7, 2022 (Good Friday) and Monday April 10, 2022 (Easter Monday) public holidays to commemorate the 2023 Easter celebrations.

The local equities market suffered loss again last week in a mixed session of buy-sell interests across major sectors of the market in reaction to the recent publications of economic data and dividend announcements by companies. In the wake of the growing sell-off sentiments in the market, investors are beginning to reposition ahead of the first quarter earnings season based on the current price levels that have been perceived to be an attractive point of entry.

This week, analysts at Afrinvest Limited expected the bearish performance to be sustained on the back of weak investors’ sentiment.

In the week to come, Cowry Assets Management also expected the current trend of mixed sentiments to linger as the market seek for a major catalyst that could trigger positive sentiments.

“However, investors are expected to trade cautiously as insecurity and political activities continues to headline Nigeria’s macros. Also, we continue to advise investors to trade on companies’ stocks with sound fundamentals and a positive outlook.” Afrinvest said.

Cordros Securities Limited said “given the thin maturity profile over the coming weeks, the absence of any significant inflows into the system this week should keep money market rates elevated over the short term. Nonetheless, we note a significant maturity at the tail-end of the month (c. N759.00 billion), which will be accompanied by coupon payments that may cause rates to descend.”