Equities Market Extends Bearish Run

The local bourse closed in the red for the fourth consecutive trading session as the NSE All Share Index (ASI) shed 43bps to settle at 40,249.29 points while YTD return fell to 5.2%. Accordingly, investors lost N63.7bn in value as market capitalization settled at N14.6tn. Today’s bearish performance was attributable to losses in DANGCEM (-0.4%), ETI (-2.4%) and DANGSUGAR (-3.7%). However, activity level strengthened as volume and value traded rose 3.2% and 77.6% to 280.1m units and N4.1bn respectively. IKEJAHOTEL (34.5m), FIDSON (32.4) and ZENITH (26.5m) were the top traded stocks by volume while the top traded stocks by value were NIGERIAN BREWERIES (N1.5bn), ZENITH (N740.9m) and GUARANTY (N402.3m).

Bearish Sector Performance
Performance across sectors was largely negative as 3 of 5 indices under our coverage closed in the red. The Insurance index was the top gainer, up 1.3%, on account of price appreciation in NEM (+3.2%) and WAPIC (+3.9%) while the Industrial Goods index marginally rose 3bps as a result of buying interest in CCNN (+5.0%). On the flipside, the Oil & Gas index shed 0.8% following sell pressures in 11PLC (-4.7%) and OANDO (-1.3%). Trailing closely were the Consumer Goods and Banking indices which declined 0.5% and 0.4% respectively, on the back of losses in DANGSUGAR (-3.7%), NIGERIAN BREWERIES (-0.6%), ETI (-2.4%), UBA (-0.9%) and ZENITH (-0.4%).

Investor Sentiment Weakens
Investor sentiment as measured by market breadth (advance/decline ratio) weakened to 0.6x from 1.2x recorded the previous trading session as 19 stocks advanced against 33 stocks that declined. The best performing stocks were IKEJAHOTEL (+9.7%), CCNN (+5.0%) and OKOMUOIL (+5.0%) while ETERNA (-8.6%), HONEYFLOUR (-5.0%) and LASACO (-4.9%) were the worst performing stocks. The successive negative performance has created room for attractive entry prices in the market. In this light, we (Afrinvest) expect bargain hunting opportunities to buoy market performance in the near term.