Aradel, Cadbury, others fuel market’s further dip by 0.66%

Nigeria’s equities market decreased further by 0.66 percent on Tuesday as more investors sold stocks like newly listed Aradel and other major laggards like Cadbury and Academy Press.

Amid dearth of catalyst capable of spurring aggressive buy-side activity on the Nigerian Bourse, the market closed on a negative note on Tuesday. The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and equities market capitalisation decreased from preceding day’s highs of 98,708.9 points and N59.812 trillion respectively to 98,058.07 points and N59.418 trillion.

In their October 28 note titled “Is foreign investment getting better?”, analysts at Coronation research noted that “Foreign Portfolio Investment (FPI) has picked up, most likely as a consequence of the CBN settling most of the backlog of foreign exchange demand earlier this year but has been trending down in recent months. Where will it go now?”

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“FPI tends to be invested in short term government securities and this money has to paid back soon, often within a year,” analysts at Coronation research further noted.

“This week we will make notional purchases and sales to ensure that our major (top-six by index weight) positions are neutral relative to the index, which have shifted a little to accommodate the recent listing of Aradel. We plan no further changes this week,” they added.

Aradel stock price decreased most on Tuesday by N50 or 8.33 percent, from N600.10 to N550.10. It was followed by Cadbury which dropped from N18.20 to N16.40, losing N1.80 or 9.89percent, and Academy Press which decreased from a high of N3.14 to N2.83, losing 31kobo or 9.87percent.

The market’s year-to-date (YtD) return decreased to 31.14 percent. This week, the market has decreased by 1.40 percent, while month-to-date (MtD) it has dropped by 0.51 percent.

In 9,547 deals, investors exchanged 399,324,907 shares worth N8.925billion. UBA, Chams, Transcorp, Zenith Bank and Access Holdings were most traded stocks.