Nigerian equities market opens the week bearish as index down 1.25%

The  Nigerian equities market started the week bearish, with the benchmark index dropping 1.25 per cent to 33611.69 points, following significant sell pressure in NESTLE shares, which led to the blue-chip stock’s largest decline in three years.

Accordingly, the Month-to-Date and Year-to-Date losses increased to 3.55 per cent and 12.11 per cent respectively.

Among sectoral indices, the Consumer Goods (-3.69%) index recorded the largest loss, owing to the significant selloff in NESTLE (-9.67%) shares – which had previously closed flat at NGN1,500 for sixteen consecutive sessions.

The Insurance (-2.09%), Banking (-1.25%), and Oil & Gas (-0.52%) indices also closed negative, owing to losses in the shares of REGALINS (-8.70%), ZENITHBANK (-1.91%), and FO (-9.29%) respectively. The Industrial Goods index closed flat.

Market breadth remained negative with a wider margin of 21 losers and 10 gainers, led by NESTLE (-9.67%) and UNIONDAC (+7.41%) respectively. Total volume and value of trades dropped by 11.75% and 35.53% to 137.63 million units and NGN1.36billion, respectively, exchanged in 3,104 deals.

“We guide investors to trade cautiously in the short to medium term, as selloffs are likely to persist, amidst brewing political uncertainty, and the absence of a one-off positive trigger. However, stable macroeconomic fundamentals remain supportive of long term gains”. Investors at Cordros capital said on Monday.

Meanwhile, the USD/NGN appreciated by 0.28 per cent to NGN360 in the parallel market, while it weakened by 0.09 per cent to NGN363.11 in the I&E FX window.

Total value of trades dropped by 36.98 per cent  to USD249.84 million, with trades consummated within the NGN350.00-NGN364.50/USD band. Meanwhile, the apex bank resumed its intervention into the FX market, with USD303.91 million injected into the interbank retail Secondary Market Intervention Sales (SMIS) and CNY 46.58 million sold in spot and short-tenured forwards.