Nigeria stocks join global plunge on tariff turmoil

..Investors lose N659bn

..$5.3trn wiped off S&P 500 in two days

Stock investors in Nigeria were left reeling from the impact of U.S President Donald Trump’s tariffs on global markets.

Investors lost about N659 billion at the close of trading on Monday after the Nigerian Exchange’s All Share Index (ASI) decreased by 1.23 percent, its biggest single-day decline this month.

Like muted buy-side activities at the Lagos Bourse, other major stock indexes and U.S. shares plunged on Monday as U.S. President Donald Trump showed no sign of backing down from his sweeping tariff plans.

The S&P 500 lost 2.3 percent, bringing its decline to nearly 20 percent in three days, a bear market in Wall Street terms. Some $5.3 trillion has been wiped off the index in two days.

The Dow Jones Industrial average also tumbled 1,015 points, or 2.6 percent, following back-to-back 1,500-point losses for the first time ever to end last week. The Nasdaq Composite dropped 1.9 percent, further into bear territory, as investors sold their tech winners to raise cash. The Nasdaq is off 24 percent from its record.

Stock markets across Europe and Asia were not left out of the seeming Black Monday as fears over the global impact of Trump’s trade tariffs deepened. The FTSE 100 opened more than 5 percent lower, following its steepest fall in five years on Friday.

Germany’s Dax plummeted 10 percent in the first few minutes of trading, before recovering ground, after Asian markets dropped steeply overnight, with Hong Kong’s Hang Seng experiencing its fourth-biggest one-day decline ever.

Read also: Trump’s tariffs spark black Monday as global equities plunge 

In 15,690 deals, Nigeria’s stock investors exchanged 444,106,631 shares worth N11.148 billion.

Lagos-based Futureview research analysts had anticipated a slow start to the week for equities, “as investor sentiment remains cautious amid prevailing global tariff concerns and the upcoming Primary Market Auction (PMA)”.

According to them, “Market participants are expected to adopt a selective approach, focusing on fundamentally sound, undervalued stocks and dividend-paying equities in search of stable returns”.

Stocks like Oando and Honeywell Flour Mills helped to push the market lower. Oando decreased most, from N42 to N37.80, down by N4.20 or 10 percent, while Honeywell dropped from N11.32 to N10.19, losing N1.13 or 9.98 percent.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and equities market capitalisation decreased from preceding day’s 105,511.89 points and N66.147 trillion respectively to 104,216.87 points and N65.488 billion. The Nigerian market’s return this year has decreased to +1.25 percent.

“The equities market is expected to improve marginally as investors continue to take position for the FY-2024 earnings season and possible corporate action declarations.

“Nevertheless, given the elevated interest rate environment in the fixed-income market, we still expect bearish sentiments to linger in the background,” analysts at Lagos-based United Capital Research said in an April 7 note.

They said the upcoming Monetary Policy Committee (MPC) decision in May “has led some investors to adopt a wait-and-see attitude towards the equities market. Concurrently, retail investors are engaging in profit-booking, resulting in sell-offs that impede the consistent upward movement of stock prices,” the analysts said.