NIGERIA EQUITY MARKET
Equities Investors Lost ₦177 Billion in Bearish Week
The Nigeria equity market traded negatively as sell-off sentiment dominated the five trading sessions of the week. The market declined 0.86% following price depreciation Financial and Oil& Gas sectors.
Consequently, the All-Share Index shed 338.23 basis points, representing a decrease of 0.86% to close at 38,921.78, while the Market Capitalization lost ₦176.74 billion, representing a decline of 0.86%, to close at ₦20.28 trillion.
Despite the negative sentiment, investors witnessed capital gain in 26 listed stocks, among which are; OANDO, which emerged as the best performing stock of the week with 14.00% growth, followed by CHAMS with 4.76% growth, while JBERGER, VITAFOAM, AFRIPRUD, CUSTODIAN, NB, FBNH and CAP grew by 3.85%w/w, 2.76%w/w, 2.40%w/w, 2.29%w/w, 1.35%w/w, 0.67%w/w and 0.51%w/w respectively.
While, CORNERST shed 15.79%w/w to top the decliners’ table, trailed by WEMABANK (-9.41%w/w), AIRTELAFRI (- 4.67%w/w), NEIMETH (-4.52%w/w), FLOURMILL (-3.50%w/w), GTCO (-2.87%w/w), STANBIC (-2.39%w/w), UBA (- 1.94%w/w), UACN (-1.43%w/w) and ZENITHBANK (- 0.41%w/w), as 34 stocks depreciated during the week.
Out of the five major market indices, only the Consumer Goods and Industrial Goods sectors grew, by 0.18%w/w and 0.004%w/w, respectively. While the Insurance, Oil & Gas and Banking sector downed by 3.39%w/w, 2.28%w/w and 0.96%w/w, accordingly.
Naira Continue to Lose Strength in the FX Market
Naira in the FX market continues to lose value as it depreciated both in the I&E Window and Parallel Market during the week.
The naira closed on Friday at ₦545/USD in the Parallel Market, to represents a decline of 2.83%w/w, and weakened at the I&E Window by 0.12% to close for the week at ₦412.00/USD.
Oil Prices sustain Recovery as Ida’s Impact U.S. Supply
Global oil prices sustain recovery, supported by growing signs of supply tightness in the United States as a result of Hurricane Ida and as U.S.-China trade hopes gave riskier assets a boost.
Consequently, the Brent rose by 0.43% to close at $73.92pb, while the Nigeria oil benchmark (Bonny Light) dipped by 0.64% to $71.30pb.
The Nigeria Foreign Reserve sustained its uptrend to a gain of $521.51 from the closing position of $34.26Bn (Friday, 3rd September, 2021) to $34.78 billion on Thursday 9th September 2021.
Global Stocks End Lower on U.S.-China Tension Ease
Bearish sentiment dominated the global market after data showing persistent U.S. inflation offset expectations of an easing in U.S.-China tensions and a call between President Joe Biden and China’s Xi Jinping.
In the U.S., all the three major market indices DJIA, S&P 500 and NASDAQ, closed the week lower by 2.15%w/w, 1.69%w/w and 1.61%w/w, respectively.
European stocks similarly traded lower as investors weighed risks from tighter monetary policies after the European Central Bank signalled a slowdown of pandemic-era bond purchases.
Accordingly, UK FTSE 100, France CAC 400 and Germany DAX dipped by 1.53%w/w, 0.39%w/w and 1.09%w/w, respectively.
However, the Asian market rallied despite two days of losses but was still in a cautious mood as global investors grapple with how best to interpret central banks’ careful moves to end stimulus, which also left currency markets quiet.
As a result, China Shanghai Composite, Japan Nikkei 225, Honk- Kong HANG SENG, and India S&P BSE grew by 3.39%w/w, 4.30%w/w, 1.17%w/w and 0.30%w/w respectively.
Negative sentiment also prevailed in other emerging markets, except for the Ghana GSE Composite and Argentina Merval that grew by 1.70%w/ and 1.55%w/w, respectively.
The rise of the number of cases of the delta variant has led to a resumption of the outperformance of stay-at-home defensive stocks like tech, as we may begin to see the reopening of energy stocks underperform significantly.