NGX Market Capitalisation Drops N3.52trn To N161.59trn

The market capitalisation of the Nigerian Exchange Limited (NGX) declined by N3.52 trillion in five trading days, dropping to N161.59 trillion as sustained sell-offs in blue-chip stocks weighed on market performance.

The benchmark NGX All-Share Index (ASI) also fell by 2.13 per cent week-on-week to close at 148,877.22 points, reflecting widespread losses across the equities market.

Consequently, investors lost N3.52 trillion in market value during the week, while the market’s year-to-date (YTD) return moderated to 59.93 per cent.

The downturn followed increased profit-taking and portfolio rebalancing by investors seeking to lock in gains after the market’s recent rally, with attention gradually shifting towards the year-end trading period.

Market analysts said the decline reflected growing caution among investors amid elevated share prices, changing portfolio allocations and expectations surrounding corporate earnings.

They noted that the broad-based nature of the sell-off suggested that selling pressure extended beyond a few heavyweight counters, as investors increasingly became cautious about sustaining exposure amid heightened market volatility.

“While the market continues to deliver a strong YTD return, the latest correction indicates that some participants are opting to lock in gains and reassess entry points,” the analysts said.

Market breadth closed negative, with 29 stocks recording gains against 57 decliners, indicating that declining equities significantly outnumbered advancing stocks.

Honeywell Flour Mills led the gainers’ chart, appreciating by 30.8 per cent to close at N29.50 per share. Transcorp Power followed with a gain of 23.4 per cent to N219.60, while eTranzact International advanced by 14.4 per cent to close at N18.65 per share.

AXA Mansard Insurance appreciated by 9.8 per cent to N11.80, while The Initiates Plc (TIP) gained 9.6 per cent to close at N26.90 per share.

On the losers’ chart, Vitafoam Nigeria led the decliners, shedding 19 per cent to close the week at N141.50 per share. Sovereign Trust Insurance followed with a loss of 17 per cent to N1.95, while Eterna declined by 15.8 per cent to N36 per share.

ABC Transport shed 13.6 per cent to close at N5.70, while International Energy Insurance lost 12.8 per cent to close at N1.70 per share.

Meanwhile, investors traded a total of 2.829 billion shares valued at N208.407 billion in 192,158 deals during the week, compared with 7.619 billion shares worth N637.826 billion exchanged in 192,138 deals in the preceding week.

This represented a significant decline in trading activity, as both the volume and value of transactions dropped amid weakening investor sentiment.

Looking ahead, Cowry Assets Management Limited said market activity would remain sensitive to investor positioning, profit-taking and the search for attractive entry points.

The investment firm said a recovery in buying interest could support a rebound in the coming week, particularly if investors take advantage of lower prices in fundamentally sound stocks.

“A recovery in buying interest could support a rebound in the coming week, particularly if investors take advantage of lower prices in fundamentally sound stocks.

“However, the negative market breadth and sharp decline in turnover suggest that confidence may take time to recover fully. Attention is likely to remain on heavyweight equities, corporate earnings releases, dividend expectations and developments affecting domestic liquidity,” the firm said.