Local Bourse Maintains Negative Close

The local bourse maintained a negative close for the second consecutive trading day as the All Share Index (ASI) slid 26bps to 40,749.86 points on Wednesday while YTD return moderated return to 6.6%. Consequently, investors lost N38.2bn in value as market capitalisation decreased to N14.7tn. The bearish performance can be attributed to sell pressures in ZENITH (-8.2%), ETI (-3.8%) and DANGFLOUR (-9.5%). Contrary to market performance, activity level improved as volume and value traded trended 10.0% and 7.9% higher to 401.4m units and N6.8bn respectively. FBNH (70.8m), ZENITH (61.2m) and FIDELITY (43.7m) were the most active stocks by volume while ZENITH (N1.7bn), NESTLE (N1.5bn), and GUARANTY (N992.3mn) led the top traded stocks by value.

Mixed Sector Performance
Sector performance was mixed as 2 of 5 indices under our coverage closed positive. The Industrial Goods index grew 0.6% on account of gains in WAPCO (+1.3%) while the Oil & Gas index closed in the green, up 0.1% due to uptick in FORTE (+2.7%). On the flip side, the Banking index led the losers, down 0.9%, as investors booked profit in ZENITH (-8.2%) and ETI (-3.8%). The Insurance index trailed losing 0.6%, as NEM (-4.9%) and WAPIC (-7.0%) recorded losses. Similarly, price depreciation in DANGFLOUR (-9.5%) and NASCON (-2.3%) dragged the Consumer Goods index 0.3% lower.

Investor Sentiment Strengthens
Investor sentiment measured by market breadth (advance/decline ratio) strengthened, albeit still soft to 0.7x from 0.3x recorded the previous day as 18 stocks advanced against 27 losers. The top performers for today were LASACO (+5.9%), FIDELITY (+5.8%) and ACCESS (+4.9%) while the laggards were led by DANGFLOUR (-9.5%), MULTIVERSE (-9.1%) and SOVEREIGINS (-9.1%). Following two consecutive days of decline, we do not rule out the possibility of a rebound in performance driven by bargain hunting in subsequent trading session.