Despite Profit-Taking, Nigerian Stock Market Witnesses Surge in Trading Activity



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Last week, profit-taking activities were observed on the Nigerian stock market. However, investors remained active, with a total traded volume of 3.680 billion shares worth N57.892 billion transacted in 40,726 deals. This marked a significant increase compared to the previous trading week, where 1.804 billion shares valued at N52.040 billion were traded in 38,550 deals.

The market operated for four trading days due to public holidays declared by the Federal Government to commemorate Easter celebration on Friday, March 29, 2024, and Monday, April 1, 2024.

Despite the surge in trading activity, the domestic equities market recorded its third consecutive weekly loss. Investors were concerned about the potential implications of the recently announced bank recapitalization plans by the Central Bank of Nigeria (CBN). Notably, tier-1 banking stocks like FBNH (-14.2%), GTCO (-8.6%), AccessCorp (-7.8%), and Zenith Bank (-4.5%) witnessed declines.

Additionally, profit-taking activities in MTNN (-2.2%) contributed to the overall market downturn. Consequently, the All-Share index (ASI) declined by 1.08% week-on-week, leading to a moderation in the Year-to-Date return to +38.3%. Similarly, market capitalization fell by N623 billion from N59.121 trillion to N58.498 trillion.

In terms of sector performance, the Banking index recorded the most substantial loss of 6.7%, followed by the Insurance (-0.9%) and Industrial Goods (-0.3%) indices. However, the Consumer Goods index advanced by 0.9%, while the Oil and Gas index closed flat.

Market operators anticipate a choppy trading pattern on resumption, with investors trading cautiously. They expect investors’ sentiments to be influenced by developments in the macroeconomic landscape and corporate actions in the short term.

The Financial Services Industry led the activity chart, contributing 78.29% and 79.81% to the total equity turnover volume and value, respectively. The Services Industry and Conglomerates Industry also recorded significant turnover.

Trading in the top three equities, namely Abbey Mortgage Bank Plc, Tourist Company of Nigeria Plc, and Zenith Bank Plc, accounted for a considerable portion of the total equity turnover volume and value.

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