Market Overview
- Year-to-Date (YtD) Performance: The Nigerian Exchange (NGX) experienced a pullback last week due to profit-taking activities, which reduced the Year-to-Date growth of the stock market from 29.9% to 28.4%. The NGX All-Share Index (ASI) closed at 95,973.45 points, down from 97,100.31 points the previous week.
- Market Capitalisation: The overall market capitalisation decreased slightly by over ₦2 billion, ending the week at ₦55.129 trillion, compared to ₦55.131 trillion the previous week.
Sector Performance
- Gainers:
- Oil and Gas Index: Up by 3.5%.
- Insurance Index: Increased by 1.9%.
- Banking Index: Rose by 0.4%.
- Losers:
- Industrial Goods Index: Declined by 4.9%.
- Consumer Goods Index: Dropped by 1.4%.
Key Factors Influencing the Market
- Profit Taking: Investors engaged in profit-taking across various sectors, especially in high-cap stocks, leading to a pullback in the market. This activity is part of a broader trend of sector rotation and portfolio rebalancing, as investors adjust to changing market conditions.
- Economic Reforms and Volatility: The market is experiencing mixed momentum due to the ongoing economic reforms in Nigeria. While fiscal and monetary policies have been introduced, their impact has yet to fully stabilize the economy, leading to continued volatility in the market.
- Oil Prices and Currency Depreciation: The fluctuating oil production and declining naira value have also contributed to market uncertainty, despite oil prices rebounding to just below $80 per barrel in the international market.
Corporate Updates
- Regency Alliance Insurance: Announced a board meeting.
- Oando: Completed a $783 million acquisition of ENI’s subsidiary, Nigerian Agip Oil Company.
- Airtel Africa: Continued its share buyback program.
- Jaiz Bank: Appointed a new non-executive director.
- MTN Nigeria, Cutix, and Ucap: Informed the Exchange of insider dealings in their shares.
Market Outlook
Analysts expect the market to continue experiencing mixed sentiments, with opportunities for bargain hunting and profit-taking. Despite the market’s recent downtrend, some stocks are seen as undervalued, providing potential buy-low, sell-high opportunities for investors. Portfolio repositioning is likely to persist as investors seek value in an oversold market region.
