HomeBUSINESSEquities Market Wrap: Investor Sentiment Remains Pessimistic

Equities Market Wrap: Investor Sentiment Remains Pessimistic

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By Fasuyi Tolulope

The equities market experienced continued negative trading, driven by downbeat investor sentiment in the local bourse. Market capitalization saw a significant decline due to unfavorable trading activities in the second quarter of 2024.

Corporate earnings reports presented mixed sentiments as major players’ balance sheets reflected negative shareholder returns. Foreign exchange exposure-driven net losses reported in the financial year 2023, which extended into the first quarter of 2024, adversely impacted on several companies’ financial standings.

Last week, an additional 402,082,657 ordinary shares of 50 Kobo each from Cadbury Nigeria Plc were listed on the Nigerian Exchange Ltd (NGX). According to a weekly report from the NGX, these shares were added following Cadbury’s conversion of a N7,036,446,501.26 intercompany loan to equity.

“With the listing of these additional shares, Cadbury’s total issued and fully paid-up shares have increased from 1,878,201,962 to 2,280,284,619 ordinary shares of 50 kobo each,” stated the regulator.

In another development, the NGX suspended trading in Arbico Plc shares on Friday. This suspension was implemented to facilitate the delisting of the company’s securities, in accordance with regulatory approval.

Additionally, the April 2024 issue of the Federal Government of Nigeria (FGN) Savings Bonds was listed on the NGX on Monday. The trading turnover for the week decreased by 15.8 percent compared to the previous session.

Specifically, investors traded 1.652 billion shares worth N42.677 billion in 38,123 deals last week, compared to the 2.187 billion shares valued at N50.667 billion traded the previous week in 45,277 deals. Consequently, the NGX All-Share Index, which began the week at 98,233.76, dropped by 0.11 percent to close at 98,125.73.

Market capitalisation also fell by 0.10 percent, or N54 billion, closing the week at N55.508 trillion, down from N55.562 trillion the previous week.

Most indices ended the week lower, except for the NGX Main Board, NGX Lotus II, NGX Industrial Goods, and NGX Pension Broad, which rose by 0.97, 0.58, 0.01, and 0.12 percent, respectively. The NGX ASeM and NGX Sovereign Bond indices remained unchanged.

The financial services industry led the activity chart by volume, with 979.479 million shares valued at N16.647 billion traded in 20,708 deals. This sector accounted for 59.30 percent and 39.01 percent of the total equity turnover volume and value, respectively.

Following this, the conglomerate industry traded 239.825 million shares worth N2.879 billion in 2,178 deals. The consumer goods industry ranked third, with a turnover of 148.685 million shares worth N3.525 billion in 4,757 deals. The top three equities by volume—Custodian Investment Plc, Guaranty Trust Holding Company Plc, and Access Holdings Plc—traded 500.343 million shares worth N11.768 billion in 6,551 deals, contributing 30.29 percent and 27.57 percent to the total equity turnover volume and value, respectively.

Last week, 28 equities appreciated in price, fewer than the 40 equities in the previous week. Conversely, 51 equities saw a price decline, up from 37 in the previous week, while 76 equities remained unchanged, slightly lower than the 77 recorded the prior week.

On the losing side, PZ Cussons Nigeria led with a 22.16 percent drop, closing at N21.60 per share. NEM Insurance followed with an 18.36 percent decline to N8.45 per share. Eterna Plc fell by 18.32 percent to N11.15 per share, United Bank of Africa (UBA) decreased by 17.23 percent to N21.85 per share, and The Initiates Plc dropped by 15.22 percent to N1.95 per share.

Conversely, International Energy Insurance topped the gainers’ list, rising by 11.49 percent to close at N1.65 per share. McNichols Plc followed with a 9.89 percent increase to N1.00 per share. Custodian Investment Plc rose by 9.68 percent to N10.20 per share, Julius Berger advanced by 9.53 percent to N79.30 per share, and Airtel Africa Plc gained 8.97 percent to close at N2,150 per share.

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