Bearish sentiment trailed the Nigerian stock market in the just concluded week, amid mixed financial performance released by banks.
The half-year results of some Tier-1 banks showed that Guaranty Trust Holding Co reported a 15.76 per cent decline in Profit After Tax, while United Bank for Africa recorded a 36.35 per cent increase in PAT.
According to market analysts, the relatively weak financial performance by GTCO rubbed off on the equities market; hence, the Nigerian Exchange Limited All-Share Index moderated Week-on-Week by 0.86 per cent to settle at 38,921.78 points.
Amid sustained sell pressure, investors lost N176.75bn W-o-W as the market capitalisation dropped to N20.28tn, while the Year-to-Date of the domestic bourse spiked to 3.35 per cent.
Sectoral performance was relatively positive, as three of the five indices tracked closed in the green zone. Reportedly, the consumer goods index, oil and gas and industrial indices rose by 0.18 per cent, 2.28 per cent and 0.01 per cent, to close at 550.13, 371.45 and 1.959.24 points respectively.
On the negative, banking and insurance indices moderated by 0.96 per cent and 3.39 per cent, to close at 373.16 and 185.09 points respectively.
Trading activity appeared positive, as some investors took position amid declining share prices. Hence; the deals, volume and value of stocks traded increased by 4.60 per cent, 12.26 per cent and 45.82 per cent, to 19,315 deals, 1.43 billion units and N13.07bn respectively.
The domestic stock market index had resumed the week relatively flat at 39,251.29 points despite the increased level of activity witnessed, as the day’s trading saw buying interest in Julius Berger, United Capital, Africa Prudential and Honeywell Flour Mills shares and more of a sell-off on UAC of Nigeria, Ecobank Transnational, GTCO and Transcorp Hotels.
Amid upward reversal in stop rate, sustained profit-taking activity and bearish investor’s sentiment, the domestic equities market suffered a week-long decline, as the Central Bank of Nigeria appears to be grappling with the depreciation of the naira, especially at the parallel market where the dollar now trades at above N530.
Some of the stocks sold off by investors during the week included Zenith Bank, Stanbic IBTC Holdings, Lafarge Africa and Honeywell Flour.
The week’s trading also saw investors move their funds to the fixed income market amid rising interest rates.
Consequently, analysts predict negative sentiments this week.
Analysts at Cowry Asset Management, said, “In the new week, we expect the equities market index to close in the negative territory, as investors remain cautiously optimistic amid rising rates in the fixed income space and the depreciating naira against the United States dollar.”
