Nigeria: Investors Staked N136.24 Billion In Equities In March

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Equity transactions on the Nigerian Stock Exchange (NSE) for the month of March recorded a total of 10.166 billion shares valued at N136.241 billion in 103,441 deals, representing a 14.88% drop in volume terms and 28.49% rise in value when compared to the preceding month of February.

The financial services sector accounted for 5.74 billion units worth N54.064 billion, buoyed by the 4.005 billion units of N50.264 billion in 29,981deals, with 1.69 billion shares of Access Bank accounting for N21.21billion in 4,844 deals, compared to the 8.437 billion shares of the sector exchanged for N39.933bn in 55,075 deals.

Sterling Bank’s 1.876 billion changed hands for N4.836 billion in 1,624 deals; just as Guaranty Trust Bank’s 262.801million traded for N12.524 billion in 5,597 deals.

Despite its slide in recent weeks, the composite NSE All-Share Index for the first quarter of the year still gained 3,261.32 points to close at 41,504.51 points from the opening level of 38,243.19 points, representing 8.53% growth on a huge volume of 42.87bn shares traded by market players, from previous quarter’s 23.26bn shares traded.

Within the period however, the market index touched a high of 45,321.82 basis points and a 37,646.88 low to reveal the high level of volatility within the period.

Similarly, market capitalisation for the period was up by N1.38tr to close higher at N14.99tr, from an opening value of N13.61tr, representing a 10.14% value gain, in an earnings season with mixed sentiments.

This is despite the relatively stable and recovering business environment, but the massive sell offs in February and March sent shock waves to the market ahead of the 2019 election year, regardless of the improving companies, market and economic fundamentals.

Meanwhile, on the first trading day in the month of April, equity transactions on the stock market re-opened on a decline yesterday, following price losses incurred by major highly capitalised stocks, as the All-share index plunged significantly by 1.6 per cent.

Specifically, at the re-opening of transaction after the Easter celebration yesterday, the market capitalisation of listed equities dipped by N234 billion from N14.992 trillion achieved at the close of trading last week Thursday to N14.758 trillion.

Also, the All-share index, which measures the performance of listed firms, declined by 648.87 points or 1.6 per cent to 40,855.64 from 41,504.51 recorded on Thursday.

Indeed, at the end of the first quarter of the year, Nigeria’s equities market continued to look up despite the recent technical correction that had shaken many investors and traders out of their position, slowing down market momentum since February after an unprecedented rally in January that changed the January effect, closing the last trading session of the 63-day period on a positive note as fund managers engaged in quarter-end account balancing.

Activities in the quarter under review was up, amidst mixed sentiments for equities due to the combination of positive macro-economic data, stronger corporate earnings and growing consumer confidence and despite the socio-political instability, the nation’s rising debt profile and the government’s unclear economic reforms programme.

One factor that has been noticed over the past recent weeks is the failure of the market to react positively to the otherwise impressive 2017 full year earnings reports, which have been accompanied by high dividend payouts and yields.

It is also noteworthy that major market players continue to sell down in the name of profit taking because they had factored in these numbers into their stock pricing before now, given that the stock market is a discounting machine that prices the future of a company into the present.

The Chief Relationship Officer/Dealer with Foresight Securities & Investment Limited, Fakrogba Charles described market performance in the first quarter (Q1) as fairly well, noting that the uncertainties on the macro-economic environment impacted on the market activities.

“The market opened on a positive note , we saw an increase in price as a result of predictions from international markets on the Nigerian economy. We also saw slag because the market reacted to some companies that did not do well.

“Again there was a rebalancing of portfolio from portfolio in and that was why the market was a bit down. The earnings could not sustain the prices of some of the stocks in the market. What they gave was not fantastic with investors’ expectations.

“What is happening in the macroeconomy reflected on the market. The policies were not clear, insecurity hindered foreign investors but we look forward to a better performance in Q2, the MPC did not meet in Q1.

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