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Stock market loses N70bn in one day

By on September 8, 2016

The Nigerian Stock Exchange market capitalisation dropped by N70bn on Tuesday following losses in 29 stocks and gains in 10 stocks.

Market capitalisation dropped to N9.447tn from N9.517tn, while the NSE All-Share Index slipped to 27,503.81 basis points from 27,707.12 basis points.

A total of 176.772 million shares valued at N1.885bn were traded in 3,682 deals.

The equities market dropped more points (73 basis points) at the close of today’s session amidst increased pressure across market heavyweights.

The market attained a maximum index point of 28,419.92 basis points in the course of trading on Tuesday, while the lowest and average index points stood at 27,503.81 and 27,797.31 basis points.

The banking and oil and gas sectors led market declines following negative closes in Zenith Bank Plc (2.34 per cent loss), Union Bank of Nigeria Plc (five per cent loss), Forte Oil Plc (2.82 per cent loss) and Total Nigeria Plc (0.37 per cent loss).

The industrial goods sector was next with 0.68 per cent loss as Dangote Cement Plc recorded 1.14 per cent loss and Portland Paints Plc losing 9.09 per cent owing to sell pressure. The consumer goods sector, however, closed relatively flat, recording 0.04 per cent loss after losses in Cadbury Nigeria Plc (4.11 per cent loss) and Champion Breweries Plc (4.72 per cent loss) outweighed gains in Guinness Nigeria Plc (0.49 per cent gain).

On the global front, Asian markets traded mixed as investors weighed the Reserve Bank of Australia decision to keep interest rate unchanged. In Europe, markets seesawed as oil prices pared yesterday’s gains. The United States markets opened flat after ISM non-manufacturing PMI for August surprisingly came in at 51.4 below Reuters estimate of 55.0.

“The negative closes across all key sectors amidst widening negative breadth and low trade volume suggests that market sentiment has become bearish. We believe this could weigh further on the ASI in the session ahead,” analysts at Vetiva Capital Management Plc said in a brief.

Meanwhile, interbank call rate in Nigeria surged 716 basis points to 27.33 per cent on the back of relatively tight system liquidity. At the foreign exchange interbank market, the naira depreciated N0.72 to close at N314.92.

There was a clear sentiment reversal in fixed income markets on Tuesday as bears seized the upper hand. Yields in the Treasury bills market rose 33bps amidst selling momentum weighted on short-dated bills. In particular, yields on the 37 Days-to-Maturity (1.03 per cent gain), 44DTM (1.09 per cent gain), and 93DTM (1.64 per cent gain) bills rose to 15.79 per cent, 15.75 per cent, and 15.09 per cent respectively.

Similarly, the bond market turned bearish although sell pressure was weighted across the entire space. The most notable changes were on the 12.5 per cent Federal Government of Nigeria January 2026, 10 per cent FGN July 2030, and 12.4 per cent FGN March 2036 bonds as their yields climbed 15bps, 11bps, and 17bps to close at 15.21 per cent, 15.07 per cent, and 15.19 per cent respectively.

 

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