Losses in Banking Stocks Drag Market Performance

The Nigerian equities market closed the trading day negative on Monday as the All Share Index lost 31bps to close at 37,250.78 points while YTD return moderated to 38.6%. Resultantly, investors lost N36.1bn as market capitalization settled at N12.9tn. Today’s negative Performance is largely attributable to losses in banking stocks- STANBIC (-4.7%), ZENITH (-1.0%), ETI (-3.0%) and ACCESS (-0.6%).  However, activity level was mixed as volume traded inched 8.3% higher to settle at 942.7m units while value dipped 5.2% to close at N4.8bn. 

Banking Index Drags Performance
Sector performance was mixed as 3 of 5 indices closed in the green, one trended southwards and the other flat. The Banking index emerged the lone loser, down 0.6% owing to price depreciation in ETI (-3.0%), ZENITH (-1.0%) and ACCESS (-0.6%). On the flip side, the Consumer Goods index led gainers, up 0.3% due to upticks in NIGERIAN BREWERIES (+0.9%), DANGSUGAR (+3.3%) and PZ (+3.4%). The insurance index trailed, up 0.2% on account of gains in CONTINSURE (+2.9%) and LAWUNION (+4.9%). Similarly, buying interest in FORTE OIL (+2.5%) pushed the Oil & Gas index 0.1% higher. The Industrial goods index closed the day flat.

Investor Sentiment Weakens
Investor sentiment as measured by market breadth (advancers/decliners ratio) softened to 0.8x from 1.4x recorded the previous Friday as 18 stocks advanced against 34 decliners. The top performing stocks were LAWUNION (+4.9%), NAHCO (+4.9%) and DANGFLOUR (+4.0%) while the worst performers were AIRSERVICE (-4.9%), PORTPAINT (-4.8%) and UPL (-4.7%). Following the negative market performance today, we expect bargain hunting - especially in banking stocks - to buoy market performance in subsequent trading sessions.