The Nigerian equities market faced a challenging week, as the All-Share Index (ASI) lost 1.19%, closing at 106,538.60 points. The market decline was largely driven by a combination of portfolio rebalancing and the fallout from global developments, particularly the uncertainty stemming from U.S. President Trump’s tariff pronouncements, which spooked global markets and added pressure to local investor sentiment. Despite positive corporate earnings reports, which typically would have lifted market morale, the equities market remained firmly in bearish territory.
Thank you for reading this post, don't forget to subscribe!“Investors are facing heightened levels of uncertainty, and this has significantly impacted the Nigerian market,” said Dr. Ngozi Okoro, an economist at the Nigerian Economic Summit Group. “The global ripples from trade tensions, especially between the U.S. and its trading partners, have compounded local challenges, and in such an environment, even positive earnings reports fail to instill confidence.”
Market capitalization also suffered, dropping by 0.71% week-on-week to N66.72 trillion. This decline was partly due to the issuance of additional ordinary shares by companies like Ellah Lakes and Fidelity Bank, which weighed on investor sentiment. As a result, the year-to-date (YTD) return on the ASI fell to 3.51%, following a N476.01 billion loss over four of the five trading days.
“While market capitalization has seen a slight contraction, we are still seeing some fundamental strength in certain sectors and stocks,” noted Dr. Chuka Obasi, a financial market analyst. “However, the overall sentiment remains fragile, and with global market trends impacting investor behavior, the bearish momentum is unlikely to subside quickly.”
The market’s trading activity mirrored the cautious mood. Total volume edged down by 1.62%, reaching 1.82 billion units, while total trade value saw a more substantial 8.10% decline, falling to N47.23 billion. On a positive note, the number of trades slightly increased by 1.79%, indicating pockets of investor interest despite the overall downturn.
Sectoral performance was also largely negative, with five out of the six tracked sectors closing in the red. The banking, insurance, and consumer goods sectors suffered the most, losing 2.87%, 2.33%, and 1.72%, respectively. The oil and gas index also experienced a modest 0.19% drop, while industrial stocks remained largely unchanged with a marginal loss of 0.01%. “The pressure on the banking sector is particularly notable, as the sector has long been a bellwether for the Nigerian economy,” said Dr. Lajide Bamidele, a sectoral analyst. “With the ongoing market volatility, investors are understandably cautious.”
Despite the overall market slump, the NGX Commodity Index stood out as a rare positive, buoyed by bullish price movements in stocks like Okomu Oil and Aradel Holdings. In the stock-specific space, Tantalizer saw the biggest gains of the week, surging by 36.3%, followed by UHM REIT with a 28.6% jump. Other stocks, including Livestock Feeds, Learn Africa, and NGX Group, also registered double-digit gains. On the other hand, Eterna faced the heaviest selling pressure, dropping by 18.7%, while Transcorp, FCMB, Royal Exchange, and Sovereign Insurance also recorded significant declines.
Looking ahead, market participants expect a tug-of-war between bullish and bearish forces. Investors are closely watching for the release of top-tier banks’ audited financial statements, which could potentially shift market sentiment either way. “Financial results, especially from the large banks, often provide insight into the health of the broader economy,” said Dr. Okoro. “If the results are positive, we may see a sentiment shift, but if they’re weak, the market could face further downward pressure.”
Overall, analysts suggest that, despite the market’s overbought position, opportunities may still exist for investors willing to take a strategic, long-term view. “The key will be patience and selecting stocks with strong fundamentals,” said Dr. Obasi. “In uncertain times, investors who are strategic and stick to their analysis will likely find opportunities to weather the storm.”
