Equity investors lose N4.9 trillion as the market’s uptrend reverses

By Peter Egwuatu

The Nigerian stock market reversed its upward trend last week, with investors losing more than N4.915 trillion of the value of shares listed on the Nigerian Exchange Limited (NGX).

The decline was driven by a sustained profit‑taking wave across major sectors.

As a result, the NGX market capitalisation fell to N155.593 trillion on Friday, down from N160.508 trillion the previous week.

Analysts said the week‑on‑week bearish close reflects a mix of portfolio rebalancing, valuation concerns after the market’s strong rally, and cautious positioning by investors who want to protect gains accumulated over recent months.

The NGX All Share Index (ASI), which tracks overall price movements, also fell 3.1%, closing at 242,593.31 points on Friday compared with 250,385.47 points the week before. This indicates that trading sentiment remained largely negative throughout the week, with sellers dominating the banking, oil and gas, industrial, consumer goods and insurance sectors.

Last week’s trading analysis shows that losses in FirstHoldco (-11.4%), BUA Cement (-10.0%), ARADEL (-9.5%), MTNN (-5.5%) and WAPCO (+3.5%) contributed significantly to the ASI’s decline. Month‑to‑date (MTD) and year‑to‑date (YTD) returns settled at 0.5% and 56.4%, respectively. Market participation improved as trading volume and value rose by 71.7% and 67.9% week‑on‑week, respectively. Sectoral performance was broadly negative, with the Oil & Gas Index down 5.2%, Industrial Goods Index down 4.4%, Banking Index down 3.4%, Insurance Index down 1.9% and Consumer Goods Index down 0.7%.

Analysts at InvestData Consulting Limited commented on the outlook: “Looking ahead, the market is likely to experience mixed sentiment as bargain hunting competes with continued profit‑taking. While short‑term volatility may persist, the medium‑to‑long‑term outlook remains positive, supported by strong corporate fundamentals, improving economic conditions and growing investor confidence in the domestic market. Stocks with resilient earnings profiles, attractive valuations and strong dividend potential are expected to attract renewed demand once the current corrective phase stabilises.”

They added: “Investors should remain selective, focusing on fundamentally strong companies while taking advantage of opportunities created by market weakness.”

Analysts at Cordros Capital added: “Looking ahead, we expect market activity to remain cautious and largely range‑bound in the near term, given the lack of a meaningful catalyst to spur buying interest.”

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