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Investors Lose N185bn as Equities Market Remains Bearish September 09, 2019
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Negative sentiments persisted at the stock market last week, leading to investors losing N184.5 billion. Having recovered three weeks ago, the market slipped into the hands of the bears the previous week, falling 0.9 per cent.

That negative trend was sustained last week with the Nigerian Stock Exchange (NSE) All-Share Index, declining by 1.38 per cent to 27,146.57. Market capitalisation went down by same margin or N184.5 billion to close at N13.207 trillion.

Buying interest in Nestle Nigeria Plc, Cement Company of Northern Nigeria, MTN Nigeria and International Breweries Plc lifted the market by 0.14 per cent, 0.08 per cent respectively on Monday and Tuesday. But the market ended on Wednesday in the negative territory shedding 0.97 per cent. It also declined by 0.17 per cent, 0.39 per cent on Thursday and Friday in that order.

In terms of sectoral performance, the NSE Insurance Index rose 0.8 per cent to lead the gainers while the NSE Banking Index followed with 0.2 per cent. Conversely, the NSE Consumer Goods Index shed 1.3 per cent, trailed by NSE Industrial Goods Index with a decline of 1.0 per cent. The NSE Oil & Gas Index shed 0.03 per cent.

Commenting on the performance of the market, analysts at Afrinvest (West Africa) said: “We expect the bearish momentum to continue although there is room for gains due to opportunities for bargain hunting in fundamentally sound stocks.”

Generally, the African markets were bearish apart from Egypt that gained 0.7 per cent. GSE Composite and Kenya’s NSE 20 Indices lost the most, shedding 1.9 per cent apiece.  Mauritius’ SEMDEX and Morocco’s Casablanca MASI index lost, shedding 1.0 per cent apiece.

Looking at the developed markets under its coverage, Afrinvest said there was a sustained bullish performance despite trade tensions.

According to Afrinvest, United States (US) and China resumed trade negotiations, but tensions worsened last week as both countries implemented new tariff measures and announced new ones.

“On September 1, 2019, the US applied 15.0 per cent tariff on $125 billion worth of Chinese imports as planned, with a further $156 billion expected to be affected by December 15. In addition, the US plans to increase the existing tariff on a separate $250 billion of Chinese goods to 30.0 per cent from 25 per cent by October 1, 2019. 

“China imposed tariff between 5.0 per cent and 10 per cent on $75 billion worth of US goods as countermeasures, with more expected in response to the actions of the US. In the United Kingdom, the risk of a ‘no-deal-Brexit’ eased as a bill to forestall it, which is likely to pass, was brought forward by lawmakers,” it said.

However, the  US S&P 500 and NASDAQ indices gained to 1.9 per cent and 2.1 per cent respectively on optimism about the restart of trade negotiations. In Europe, France’s CAC, Germany’s XETRA DAX and UK’s FTSE All Share indices were up 2.2 per cent, 1.9 per cent and 0.9 per cent respectively as the chance of a ‘no-deal-Brexit’ weakened. Similarly, Japan’s Nikkei 225 appreciated 2.4 per cent W-o-W while Hong Kong’s Hang Seng index gained 3.8 per cent as sentiments strengthened following the withdrawal of the controversial extradition bill.

Across the BRICS market, performance was bullish as four  of  five markets  ended the week in the positive territory. China’s Shanghai Composite Index led with 3.9 per cent gain, reversing the previous week’s loss despite additional tariffs while Russia’s RTS Index went up by up 3.6 per cent. Brazil’s Ibovespa and South Africa’s FTSE/JSE indices also inched up 1.4 per cent and 0.8 per cent in that order in spite of slowdown in economic activities due to unrest in the latter country. Meanwhile India’s BSE Sens index lost 0.9% W-o-W as economic growth slowed.

Also, performance across the Asian and Middle East market was bearish as only one index appreciated. UAE’s ADX General Index emerged lone gainer, rising 1.0 per cent. Turkey’s BIST 100 Index led the losers, shedding 2.4 per cent. Similarly, Thailand’s SET index and Saudi Arabia’s Tadawul ASI  fell  0.9 per cent and 0.4 per cent in that  order, while  Qatar’s DSM 220 index  went down by  0.2 per cent.

Market turnover

Meanwhile, a total turnover of 1.101 billion shares worth N17.082 billion in 15,431 deals were traded last week by investors in contrast to a total of 713.141 million shares valued at N13.295 billion that exchanged hands the previous week in 16,237 deals.  

 The Financial Services industry led the activity chart with 752.440 million shares valued at N9.900 billion traded in 8,519 deals, thus contributing 68.34 per cent and 57.96 per cent to the total equity turnover volume and value respectively. The Conglomerates industry followed with 93.204 million shares worth N239.250 million in 883 deals. The third place was Construction/Real Estate Industry with a turnover of 65.808 million shares worth N66.730 million in 100 deals.    

Trading in the top three equities namely, Guaranty Trust Bank Plc, Access Bank Plc and Zenith Bank Plc, accounted for 530.372 million shares worth N9.096 billion in 3,604 deals, contributing 48.17 per cent and 53.25 per cent to the total equity turnover volume and value respectively.

A total of 3,692 units of Exchange Traded Products valued at N1.974 million were traded last week in 10 deals compared with a total of 4,865 units valued at N76,851.65 transacted the previous week in 15 deals.

Also, a total of 47,690 units of Federal Government Bonds valued at N51.008 million were traded last week in 15 deals compared with a total of 4,336 units valued at N4.443 million transacted in 12 deals.

Top price gainers and losers

A look at price movement chat showed that 27 equities appreciated in price during the week, higher than 25 equities in the previous week, while 34 equities depreciated in price, lower than 35 equities in the previous week.

Cornerstone Insurance Plc led the price gainers with 28.5 per cent, trailed by International Breweries Plc with 23.1 per cent. UAC of Nigeria Plc chalked up 21 per cent, just as UACN Property Development Company Plc went up by 12.5 per cent. 

Continental Reinsurance Plc gained 12.4 per cent, just as Cement Company of Northern Nigeria Plc and NPF Microfinance Bank Plc garnered 9.7 per cent apiece. 

Associated Bus Company Plc, Linkage Assurance Plc and Cadbury Nigeria Plc appreciated 9.3 per cent, 8.3 per cent and 6.4 per cent in that order.

Conversely, University Press Plc led the price losers with 18.2 per cent, trailed by Ikeja Hotel Plc with 18.1 per cent. Tripple Gee & Company Plc shed 16.1 per cent, just as Forte Oil Plc and Neimeth International Pharmaceuticals Plc went down by 11.8 per cent and 10 per cent respectively.

Guinness Nigeria Plc shed 9.9 per cent, while Champion Breweries Plc 9.8 per cent.   FBN Holdings Plc and Sterling Bank Plc shed 8.4 per cent and 8.0 per cent in that order.

By THISDAY