Equities’ Investors Lose N201bn W-o-W Amid Post-MPC Rebalancing

After riding a bullish wave for four consecutive weeks, the Nigerian equity market reversed course, closed last week in the red,losing N201 billion in the process, as investors reassessed their positions in response to the Central Bank of Nigeria(CBN)’s recent monetary policy stance.

The benchmark NGX All-Share Index declined by 0.62 per cent week-on- week to close at 109,028.62 points. Similarly, the overall market capitalisation lost N201 billion to close the week at N68.752 trillion.

Analysts said the market retreat appears to be a result of portfolio rebalancing activities by investors following the CBN’s decision to keep all policy parameters unchanged at its 300th Monetary Policy Committee meeting.

Specifically, the bourse saw the admission of 34.2 billion new ordinary shares from United Bank for Africa’s rights issue, which effectively expanded the market float and contributed to a notional loss of approximately N201.4 billion in investor wealth.

Sectoral performance was mixed. NGX Consumer Goods index recorded a weekly gain of 2.18 per cent. The NGX Insurance and NGX Industrial Goods indices posted weekly gains of 0.73 per cent and 0.72 per cent respectively. On the downside, the NGX Oil & Gas index declined to a weekly loss of 3.44 per cent. NGX Banking Index dropped 1.52 per cent, and the NGX Commodity index lost 0.75 per cent W-o-W.

However, market breadth for the week was positive as 52 equities appreciated in price, 41 equities depreciated in price, while 55 equities remained unchanged. Cutix led the gainers table by 21.92 per cent to close at N3.17, per share. Custodian Investment followed with a gain of 21.45 per cent to close at N21.80, while Red Star Express went up by 20.90 per cent to close to N6.71, per share.

On the other side, NEIMETH International Pharmaceuticals led the decliners table by 17.03 per cent to close at N3.07, per share.

Associated Bus Company followed with a loss of 15.59 per cent to close at N2.49, while Transport Hotels declined by 15.03 per cent to close at N138.50, per share.

Overall, a total turnover of 3.932 billion shares worth N74.813 billion in 105,220 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 2.606 billion shares valued at N63.785 billion that exchanged hands previous week in 77,593 deals.

Looking ahead to the new trading week, Cowry Assets Management Limited said “market sentiment is expected to remain cautiously optimistic. The anticipated release of Nigeria’s Q1 2025 GDP report is likely to influence investor positioning, especially if it confirms expectations of positive economic output growth.

“Additionally, the ongoing corporate earnings season may provide fresh catalysts for stock-specific rallies. At Cowry Research, we maintain a broadly constructive outlook for the near term and continue to advise investors to focus on fundamentally sound companies with strong earnings visibility and resilience to macroeconomic headwinds.”