The downward trend in the stock market continued for the sixth straight week following sell pressure in some blue chip companies with investors losing N305 billion.
The market volatility had remained at the extreme majorly driven by mixed sentiments while investors continue to seek safer investment haven as hedge against inflation in the face of attractive fixed income yields.
Consequently, the benchmark All Share Index (ASI) fell by 1.04 percent to 51,355.74 points from 51,893.94 points during the week despite the market closing marginally higher on three out of the four trading sessions.
Similarly, the market capitalisation which represents the value of all listed equities decreased to N27.963 trillion from N28.268 trillion, representing a 1.08 percent decline.
The downward slide was primarily due to sell pressures on MTN Communication Nigeria (-6.7%), amid strong bargain hunting on Transcorp Plc (+45.0%) and Access Bank (+11.9%).
Activity level was positive with traded volume and value increasing by 41.2% and 45.6% to 3.92 billion units and N15.62 billion respectively.
Performance across the sectors was mixed during the week.
The insurance and consumer goods sectors appreciated by 1.14% and 0.17% respectively, on the back of renewed buying interests in Transcorp Plc and Axa Mansard Plc.
On the other hand, the banking (-2.54%), oil & gas (-1.43%) and the industrial goods (0.17%) sectors emerged as the decliners.
Analysts at Cowry Asset Management, projected that the current trend will linger if the selling sentiment among the highly priced stocks moderates and liquidity in the market improve further on dividend payment as more and more companies hold their AGM for shareholders to approve payment
“We expect the NGX’s floor to be flooded with results as the Q1-23 earnings season commences in full swing.”
Also commenting, analysts at Cordros Capital said: “We expect decent earnings releases across board to temper selling activities and support positive sentiments on the bourse.
“In the medium term, we expect investors’ sentiments to be influenced by developments in the macroeconomic landscape and the movement of yields in the fixed-income space.
“Overall, we reiterate the need for positioning in only fundamentally sound stocks as the weak macro environment remains a significant headwind for corporate earnings.”