Investors saw a significant loss of N847 billion in the stock market last week, driven by profit-taking activities and selloffs on the Nigerian Exchange Limited (NGX).
As a result, the market capitalization of the NGX, reflecting the total value of investments on the Exchange, fell to N55.131 trillion, down from N55.978 trillion the previous week.
Similarly, the NGX All Share Index (ASI), another key market indicator, declined by 1.5%, closing at 97,100.31 points on Friday, compared to 98,592.12 points the week before. The widespread profit-taking across major sectors contributed to the decline, offering market participants opportunities to acquire value stocks at discounted prices.
During the week, more companies announced their Annual General Meetings (AGMs) to the Exchange, with FBN Holdings being the latest, while Airtel Africa continued updating the Exchange on its ongoing share buyback program.
In light of these developments, analysts have advised investors to focus on companies with consistent dividend payments, robust fundamentals, and strong growth prospects. Such companies are likely to support future earnings growth, which will positively influence stock prices across different market cycles.
Market analysis indicates that Month-to-Date (MTD) and Year-to-Date (YTD) returns have moderated to -0.7% and +29.9%, respectively. Trading activity also saw a decline, with trading volume and value dropping by 24.1% and 1.4% Week on Week (W/W), respectively. Sector performance was mixed, with the Oil & Gas Index gaining 5.3%, the Insurance Index up by 0.8%, and the Consumer Goods Index rising by 0.4%. In contrast, the Industrial Goods Index and the Banking Index fell by 5.2% and 2.3%, respectively.
Looking ahead, analysts at Cordros Research anticipate that bearish sentiments will continue to dominate as investors remain cautious with a subdued appetite for equities. They also noted that macroeconomic developments and corporate actions during the upcoming earnings season are likely to shape investor sentiments in the near term.