Market Halts Bullish Trend

A 3-day upward trend was reversed at the close of trade on Tuesday as the All Share Index (ASI) fell 82bps to close at 36,669.61 points –implying a moderation in YTD return to 36.4%. Accordingly, investors lost N103.8bn as market capitalization settled at N12.6tn primarily due to losses in DANGCEM (-1.8%), NESTLE (-3.3%) and GUARANTY (-1.0%). Despite the 1.4% drop in volume to N211.9m units, total value of trades increased dramatically, rising 73.6% from N2.7bn to N4.7bn.

All Indices Close in the Red
Sector performance was negative across board as all indices declined. On the back of drops in DANGCEM (-1.8%) and NESTLE (-3.3%), the Industrial and Consumer Goods indices were the major losers, both down 0.9% from previous close. Similarly, the Oil & Gas index fell 0.5% owing to a loss in MOBIL (-5.0%). The Insurance index declined (0.4%) following a depreciation in MANSARD (-4.6%) whereas the Banking index reversed on yesterday’s top position to marginally fall 0.1% contrary to Monday’s 1.0% increase on account of the reduction in GUARANTY (-1.0%).

Investor Sentiment Stays Positive
Despite the decline in performance, market breadth remained positive at 1.0x (from 1.8x on Monday) as 21 stocks advanced against 21 decliners. The best performers were INTBREW (+5.8%), NEM (+4.5%) and FIRSTALUM (+4.0%) while REDSTAREX (-9.2%), NEIMETH (-8.8%) and CHAMPION (-5.2%) were the worst performers. We attribute the day’s negative close to profit taking on recent gains in the equities market, however we expect an upturn in following sessions due to Q3:2017 earnings releases.

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