Nigeria’s stock market started this week on a negative note, thereby defying some analysts’ earlier sentiment in favour of bargain hunting.
The market decreased by 1.27percent at the sound of trade closing gong on Custom Street, Lagos.
Following four weeks of consecutive losses, Afrinvest research analysts expected to see some bargain hunting in early trades this week. However, they maintained a bearish outlook in the near term “as overall investor sentiment remains weak.”
Only this month, the market has decreased by 6.25percent. This negative has almost wiped off the record positive returns year-to-date (ytd), which now stands at a record low of 0.74percent.
The Nigerian Stock Exchange (NSE) All Share Index (ASI) which opened this week at 27,388.62 points decreased to 27,041.03 points.
The record dip on Monday was driven by sell off in some largely capitalised stocks like Julius Berger Plc, which decreased from N24 to N22.4, after losing N1.6 or 6.67percent.
Also, Nigerian Breweries Plc stock price decreased from N48.45 to N47, shedding N1.45 or 2.99percent; while GTBank Plc was down, from N27.95 to N26.9, losing N1.05 or 3.76percent.
Cadbury Nigeria Plc decreased from N9.1 to N8.2, shedding 90kobo or 9.89percent, while Zenith Bank Plc declined from N19.85 to N19.1, losing 75kobo or 3.78percent.
On the gainers table, Law Union & Rock advanced most, from 73 to 80kobo, adding 7kobo or 9.59percent. May & Baker followed, after moving up from N1.82 to N1.87, gaining 5kobo or 2.75percent. Others are: Sterling Bank Plc which increased from N1.46 to N1.5, adding 4kobo or 2.74percent; Linkage Assurance Plc which also rose from 43kobo to 45, adding 2kobo or 4.65percent, and Vitafoam Plc which moved up from N4.5 to N4.51, gaining 1kobo or 0.22percent.
“We expect bargain hunting activity in some dividend paying stocks as investors seek to take advantage of high dividend yield environment”, according to research analysts at Vetiva Capital.
The value of listed stocks on the Bourse printed lower at N14.087trillion as against preceding day high of N14.268 trillion. Investors lost N181billion at the close of trading.
“Given that this week is the last week for companies that did not submit their unaudited results to submit audited results; we expect an increased influx of audited financial reports and possible dividend pronouncements. Thus, providing incentives for investors to lock in positions in high dividend yielding stocks,” said United Capital research analysts in their February 24 note.
In 4,533 deals, equity dealers exchanged 429,003,016 units valued at N7.298billion. GTBank, FBN Holdings, Zenith Bank, UBA, and United Capital were actively traded stocks on the NSE.