Equities Market Pullback on Loss in Nigerian Breweries

The Nigerian Equities market retreated into the negative territory after the marginal gain recorded yesterday as the All Share Index (ASI) declined 74bps to close at 28,798.67pts, whilst market capitalization shed N74.3bn to close N9.9bn.

Consequently, MTD and YTD losses widened to 1.3% and 16.9%. The pullback in the broader index was majorly due to the sustained sell-pressure in NIGERIAN BREWERIES (-2.3%) and depreciations in WAPCO (-4.0%) and ETI (-3.3%). Market activity also softened with volume and value traded declining 23.0% and 10.7% to 167.3m units and N1.3bn respectively.

Consumer Goods Index Tops Decliners Chart
All sector indices closed negative save for the Oil & Gas index which rebounded 6bps due to bargain hunting in OANDO (+0.5%) and ETERNA (+2.7%). The Consumer Goods index however led laggards as it slid 1.7% on the back of sustained pressure in NIGERIAN BREWERIES (-2.3%) and NESTLE (-0.9%); followed by the Industrial Goods index (-1.6%) - weighted down by WAPCO (-4.0%).

The Banking index also closed 1.0% lower due to waning sentiment in ETI (-3.3%) whilst the Insurance Index bucked its gaining trend due to profit-taking in MANSARD (-1.8%).

Market Sentiment Remains Weak
Sentiments for equities have remained weak with the market breadth -- which is a ratio of advancers to decliners -- weakening to 0.4x as 12 stocks gained whilst 26 declined. Top decliners today were CAP (+5.0%), UAC-PROP (+5.0%) and DANGFLOUR (5.0%) whilst FIDSON (-4.9%), ETRANZACT (-4.8%) and MAYBAKER (-4.8%).

The sustained selling pressure on the bourse may likely be reversed in the sessions ahead as bargain hunters take advantage of the current cheap valuations to make short term gains. However, fundamental investors still continue to await fiscal policy direction from the newly inaugurated federal ministers. We remain bullish in our medium to long term outlook of the market.