Equities market moves further south by 0.31%

Nigeria’s equities market closed further in the red zone on Thursday by 0.31 percent, the second time this week since the Central Bank’s monetary policy committee (MPC) raised its benchmark interest rate known as the Monetary Policy Rate (MPR) by 25 basis points to 18.75 percent.

The Nigerian Exchange Limited (NGX) All-Share Index and equities market capitalisation decreased on Thursday from 65,687.16 points and N35.745trillion respectively to 65,482.91 points and N35.634trillion.

Investors lost about N111billion at the close of trading. Again on the sell-side of Thursday’s trading includes Cadbury which decreased from N15.30 to N13.80, after losing N1.50 or 9.80 percent.

Other major laggards are Japaul Gold which dropped from N1.11 to N1, losing 11kobo or 9.91percent; FTN Cocoa which dropped from N2.66 to N2.41, losing 25kobo or 9.40 percent and Neimeth which was also down from N1.82 to N1.65, shedding 17kobo or 9.34 percent.

Read also: Unilever, Cadbury, others dip as market get hit by rate hike

The equities market’s positive return year-to-date (YtD) stood lower at +27.77 percent.

In their July 27 stock recommendation, Futureview analysts said that, “Considering that there are many stocks trading at attractive discount, we expect a mixed sentiment in the market this week”.

Japaul Gold UBA, Transcorp, FCMB and Fidelity Bank were actively traded stocks as investors in 8,070 deals exchanged 509,247,334 shares worth
N4.795billion.

United Capital research analysts in their post-MPC commentary said the decision of the Monetary Policy Committee (MPC) is not expected to cause a slowdown in equities in the short term.

“Additionally, a bullish corporate earnings performance in second-quarter (Q20 2023 and lower fixed-income yields are anticipated to trigger the usual asset rotation seen during a significant decline in interest rates. These factors are expected to provide strong support for Nigerian equities, leading to a favourable market performance,” United Capital analysts said.