Investors have lost over N800bn in stocks this February

Not less that N898billion has been lost from Nigeria’s stock market in just ten trading days into the month of February.

After an impressive outing in January, the stock market of Africa’s largest economy has since February continued on its downward slope, as losses across sectors further push the index south.

The -4.05 percent dip seen in February has almost eroded the whole gains since year-to-date (ytd) now at just +1.06percent.

All sectoral indexes are in red this month. The NSE-30 –which tracks the performance of thirty most capitalized stocks – has decreased by 4.57percent in February. Insurance stocks are worst hit this month as evidenced in its Index which is down by -9.46percent.

Others are: NSE Banking Index (-8.57percent), NSE Consumer Goods Index (-4.08percent), NSE Industrial Goods Index (-568percent), and NSE Oil and Gas Index (-0.42percent).

Amid stocks new lows, market watchers anticipate some bargain hunting activities in the next few trading sessions, driven by attractive entry points for most fundamentally sound stocks.

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The market opened February with benchmark index at 42,412.66 points and market capitalization of N22.187 trillion.

At the close of trading session on Wednesday, the Nigerian Stock Exchange (NSE) All Share Index (ASI) moved down by 1.96percent from preceding day high of 41,510.16 points to 40,696.01 points, while market capitalisation, a measure of value of listed stocks on the domestic bourse decreased by N426billion, from preceding day high of N21.715trillion to N21.289trillion.

“In spite of the low prices of most fundamentally sound stocks coupled with the attractive entry levels, investors’ sentiment remained weak at the local bourse amid persistent sell pressure in major bellwether stocks.

In 5,718 deals, investors exchanged 366,858,804 units valued at N5.482billion on Wednesday February 10. Meanwhile, Zenith, FBN Holdings, GTBank, Courteville and Transcorp were most traded stocks while top decliners are: Fidson (-10percent), CAP (-10percent), Regency Alliance (-10percent), Sovereign Trust Insurance (-10percent), and Sunu Assurance (-10percent).

“Given the possibility of yield reversals in the Fixed Income market, coupled with the negative outlook for the yet to be released fourth-quarter (Q4) 2020 GDP reports, we expect the ASI to remain pressured in the short term, hence, a cautious trading strategy is recommended”, said Vetiva research analysts in their February 10 note to investors.