Nigeria: NSE All-Share Index Sheds 0.9 Percent As Market Resumes Bearish Trend

2 September 2019

After one week of positive performance, the stock market began its depreciation last week following losses in bellwethers stocks such as Seplat Petroleum Development Plc. Dangote Cement Plc, Guaranty Trust Bank Plc. The market had chalked up 3.2 per cent the previous week after a long bearish period.

However, the positive performance could not be sustained last week as the Nigerian Stock Exchange (NSE) All-Share Index shed 0.99 per cent to close at 27,525.81, while market capitalisation shed N133.5 billion to be at N13.391 trillion.

Similarly, all other indices finished lower with the exception of NSE Insurance Index, and NSE Industrial Goods Index which appreciated by 1.15 per cent, 0.04 per cent and 0.34 per cent while the NSE ASeM index closed flat.

The sectoral performance was bearish as four of the five posted declines led by the NSE Oil & Gas Index with 10.8 per cent. The NSE Banking Index went down by 3.5 per cent just as the NSE Consumer Goods Index fell by 0.6 per cent. The Industrial Goods Index lost 0.3 per cent. On the positive side, the NSE Insurance Index appreciated by 1.2 per cent.

A review of the performance of some other stock markets in Africa, showed that Nairobi Stock Exchange closed last week bearish as well, shedding 0.4 per cent. Mauritius' SEMDEX Index lost, shedding went down by 0.2 per cent.

However, Egypt's EGX 30 index gained the most, up 3.5 per cent followed by Ghana's GSE Composite and Morocco's Casablanca MASI indices followed, advancing 1.8 per cent and 1.0 per cent respectively.

Across the Asian and the Middle East market, performance trended downward as three of the five monitored lost. Qatar's DSM 220 dropped 3.5 per cent while UAE's ADX General Index went down 2.5 per cent. Also, Thailand's SET index depreciated 0.5 per cent. On the positive side, Saudi Arabia's Tadawul ASI advanced 5.3 per cent following positive sentiment stirred by its inclusion on the MSCI Emerging Market Index. In the vein, Turkey's BIST 100 index inched 0.4 per cent higher.

According to analysts at Afrinvest (West Africa), optimism over trade talks buoys some other developed markets. The explained that China slightly de-escalated trade tensions last week as its proposed retaliation to the latest tariffs imposed by the United States was put on hold.

The expectation early in the week was that China would impose tariffs ranging from 5.0 per cent to 10.0 per cent on $75.0 billion worth of US goods, with the timeline for implementation matching the two phases - September and December 2019 - established by the US.

"As the deadline is only a month away, negotiations have resumed, with China more disposed towards a resolution. Meanwhile, the chance of a 'no-deal-Brexit' rose in the United Kingdom as the Prime Minster got an approval to suspend the parliament till mid-October, paving the way for swift negotiations ahead of the Brexit deadline of 31st October, 2019. While this decision is likely to be tightly contested, the lack of clarity has dampened investor sentiment and the prospects of the UK's economy post-Brexit," they said.

Consequently, some developed markets were largely bullish as investors reacted positively to softening trade tensions. In the US, the S&P 500 and NASDAQ indices gained 3.1 per cent and 3.0 per cent respectively. The France's CAC, Germany's XETRA DAX and UK's FTSE All Share indices also inched higher by 3.0 per cent, 2.9 per cent and 1.4 per cent respectively despite elevated risks of a 'no-deal-Brexit' deal. Meanwhile, Hong Kong's Hang Seng and Japan's Nikkei 225 indices lost 1.7 per cent and 0.03 per cent respectively.

Also, in the BRICS market ended in the green led by Brazil's Ibovespa Index with 3.6 per cent appreciation while Russia's RTS index trailed, gaining 1.7 per cent. South Africa's FTSE/JSE and India's BSE Sens indices also gained by 2.2 per cent and 1.7 per cent respectively on the back of renewed investor sentiment in both markets. But China's Shanghai Composite index was the lone loser, shedding 0.4 per cent.

Market turnover

Meanwhile, a total turnover of 713.141 million shares worth N13.295 billion in 16,237 deals were traded last week by investors in contrast to a total of 2.337 billion shares valued at N19.712 billion that exchanged hands the previous week in 18,379 deals.

The Financial Services Industry led the activity chart with 401.887 million shares valued at N4.069 billion traded in 8,627 deals, contributing 56.4 per cent and 30.6 per cent to the total equity turnover volume and value respectively. The Conglomerates industry followed with 123.330 million shares worth N197.298 million in 755 deals. The third place was ICT industry with a turnover of 53.887 million shares worth N5.296 billion in 852 deals.

Trading in the top three equities namely: Transnational Corporation of Nigeria Plc, Access Bank Plc and Zenith Bank Plc accounted for 242.657 million shares worth N1.808 billion in 2,990 deals, contributing 34.03 per cent and 13.6 per cent to the total equity turnover volume and value respectively.

A total of 4,865 units valued at N76,851.65 were traded last week in 15 deals compared with a total of 3,943 units valued at N1.684 million transacted the previous week in 16 deals.

Also, a total of 4,336 units of Federal Government Bonds valued at N4.443 million were traded last week in 12 deals compared with a total of 1,673 units valued at N1.674 million transacted the previous week in 31 deals.

Top price gainers and losers

The price movement chart showed 25 equities that appreciated last week, lower than 40 equities in the previous week, while 35 equities depreciated in price, higher than 25 equities in the previous week.

John Holt Plc led the price gainers with 19.5 per cent, trailed by Continental Reinsurance Plc with 11.5 per cent, just as Unity Bank Plc went up 11.1 per cent.

Mutual Benefits Assurance Plc garnered 10 per cent, just as Stanbic IBTC Holdings Plc chalked up 8.5 per cent. Tripple Gee & Company Plc, Consolidated Hallmark Insurance Plc and Associated Bus Company Plc gained 7.9 per cent, 7.1 per cent and 6.6 per cent in that order. African Prudential Plc and Cement Company of Northern Nigeria Plc appreciated 6.6 per cent and 6.3 per cent respectively.

Conversely, Seplat led the price losers with 18.8 per cent, trailed by UACN Property Development Company Plc with 17.7 per cent. International Breweries Plc shed 15.2 per cent, while Glaxosmithkline Consumer Nigeria Plc lost 13.2 per cent.

University Press Plc and Julius Berger Nigeria Plc went down by 11.6 per cent and 9.9 per cent respectively. Champion Breweries Plc and Ecobank Transnational Incorporated depreciated by 9.4 per cent and 9.3 per cent in that order.

Trans-nationwide Express Plc and Honeywell Flour Mills Plc shed 9.1 per cent in that order.

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