Stocks shed over N960bn in 3 days as investors switch assets

Nigeria’s listed equities value have decreased by N969billion in just three (3) days amid declining bargain hunting activities on the local Bourse.

The nation’s stock market has since this week recorded three consecutive days of negative closes, causing its record positive returns to reach new low of 17.49 percent, now below inflation at 18.60percent.

This record negative comes on the heels of investors seen switching assets in favour of fixed income (FI) securities. The move for higher yields increased following last week’s benchmark interest rate hike to 14 percent.

“Looking ahead to the rest of the week, we expect extended sell pressure across stocks in the local bourse as investors will continue to switch assets, considering the climbing interest rate environment. However, we maintain that investors and fund managers will continue to cherry-pick stocks with good fundamentals, as the half-year (H1) 2022 earnings season has already commenced,” United Capital research analysts said in their July 27 note.

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The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation which opened this week at 51,979.92 points and N28.031trillion respectively have decreased to 50,184.5 points and N27.062trillion.

The market dipped on Wednesday by 0.51percent, driven by leading laggards like Custodian Investment Plc, Meyer Plc and Cutix Plc.

Custodian Investment Plc led the decliners after its share price dropped from a high of N7 to N6.30, losing 70kobo or 10percent; Meyer Plc followed after its share price decreased from N2.52 to N2.27, losing 25kobo or 9.92percent, while Cutix Plc was down from N2.25 to N2.03, shedding 22kobo or 9.78percent.

In 4,977 deals, investors exchanged 829,511,373 shares valued at N4.105billion. International Energy Insurance, Transcorp, UBA, GTCO, FBN Holdings were top-5 traded stocks on Wednesday.