Nigerian Bourse Extends Losses to Second Session

The Nigerian equities market extended losses to the second trading session as the benchmark index slid 0.3% today to close at 33,142.18 points, further trimming YTD gain to 22.4%. Today’s performance was dragged by profit-taking in NESTLE (-2.6%), ACCESS (-3.7%), FORTE (-9.6%) and DANGCEM (-5.0%) which offset gains in WAPCO (+2.9%) and ZENITH (+1.0%). Consequently, investors lost N291.4m in value as market capitalization fell to N11.5tn. Likewise, activity level softened as volume and value traded fell 5.6% and 3.4% to 410.2m units and N5.5bn respectively.

Bearish Performance across Sectors
Performance across sectors was broadly bearish as all indices declined. The Oil & Gas index declined the most, down 2.0% on the back of sell pressure in FORTE (-9.6%) and SEPLAT (-1.3%) while losses in ACCESS (-3.7%) and UBA (-1.7%) dragged the Banking index 0.7% lower. Likewise, the Consumer Goods index dipped 0.6% on account of weak appetite for NESTLE (-2.6%) while the Insurance and Industrial Goods indices slipped 0.1% a piece due to profit-taking in MANSARD (-1.2%) and DANGCEM (-0.2%).

Market Breadth Stays Soft
Investor sentiment as measured by the market breadth (advancers/decliners’ ratio) weakened to 0.6x (from 0.7x yesterday) as 18 stocks advanced against 28 which declined. At the summit of the gainers' chart were MAYBAKER (+9.9%), TRANSCOR (+9.6%) and SKYE (+7.4%) while FORTE (-9.6%), CADBURY (-7.9%) and CHAMPION (-4.9%) topped the losers’ chart. We maintain our view that the current downtrend in the market would not persist beyond the short term as we expect investor sentiment to remain largely driven by improvements in macroeconomic fundamentals and developments in the FX market.