MORGANABLE MARKETS WATCH
Nigeria’s stock market extended its losses in the week ended October 23, as declining share prices outweighed gains on the Nigerian Exchange Limited (NGX).
Akure —
Nigeria’s stock market extended its losses in the week ended October 23, as declining share prices outweighed gains on the Nigerian Exchange Limited (NGX).
A total of 55 listed equities recorded price declines, while only 20 gained value. The performance reflected weaker sentiment as investors reassessed their portfolios after months of strong market gains.
According to reports published on Monday, October 26, the NGX All-Share Index closed at 247,222.27 points on Friday, down from 247,539.73 points a week earlier.
This represented a decline of 0.13%. Market capitalisation fell from ₦160.725 trillion to ₦160.519 trillion.
Consequently, the market lost about ₦206 billion in value during the week. Although the benchmark index recorded a small decline, the gap between losing and gaining stocks revealed broader weakness.
More companies lost value than gained, showing that selling pressure extended beyond a handful of equities.
Market breadth weakened. In the preceding week, 30 equities recorded losses, while 50 gained value.
However, the latest figures showed that declining stocks increased to 55, while advancing equities fell to 20.
Meanwhile, 71 equities closed unchanged, compared with 66 in the previous week. This shift suggested that buying interest had weakened across several parts of the exchange. As a result, the market struggled to maintain its earlier momentum.
Profit-taking may have contributed to the decline. Investors often sell shares after significant price increases to secure gains.
This activity can push prices lower even when companies have not announced disappointing financial results.
Despite falling share prices, trading remained active. Market reports showed that investors exchanged approximately 2.024 billion shares worth ₦110.773 billion in 173,113 deals during the week.
In comparison, the previous week recorded 1.659 billion shares valued at ₦98.088 billion in 184,632 deals.
Trading volume therefore increased by approximately 22%, while transaction value rose by about 13%. However, the number of deals declined despite the higher turnover.
The financial services sector dominated activity, recording 1.111 billion shares worth ₦53.908 billion across 81,787 deals. It accounted for 54.89% of total equity turnover by volume and 48.66% by value.
Consumer goods ranked second, with 394.039 million shares valued at ₦9.811 billion in 17,912 deals.
Agriculture followed with 147.170 million shares worth ₦2.821 billion across 7,462 deals. These figures highlight the importance of financial services to trading on the exchange.
SECTORAL PERFORMANCE AND MARKET OUTLOOK
Several major sectors recorded losses, although industrial goods moved in the opposite direction.
The insurance index suffered the steepest decline among the main sectoral indices highlighted in market reports, falling approximately 2.79% to 1,049.43 points.
The oil and gas index followed with a 2.55% decline to 6,035.77 points. Meanwhile, the banking index fell 0.67% to 2,515.47 points, while consumer goods declined 0.55% to 4,014.81 points.
In insurance, losses in Regal Insurance, Linkage Assurance and AIICO Insurance contributed to the weaker performance.
However, WAPIC Insurance recorded a gain, showing that share prices did not move uniformly across the industry.
Similarly, the oil and gas sector faced selling pressure as investors adjusted their positions in energy companies.
Aradel Holdings, Oando and Eterna featured among the stocks that weighed on the sector’s performance.
The banking sector also recorded losses. Declines in Access Holdings, United Bank for Africa and Zenith Bank outweighed gains in First HoldCo and Fidelity Bank.
Consequently, weakness among several prominent financial stocks added to pressure on the wider market.
Industrial goods provided some relief. The sectoral index gained 1.95% to close at 10,646.68 points, making it the strongest performer among the principal indices highlighted in the reports.
Individual share-price movements further illustrated the mixed performance. ABC Transport led the gainers, appreciating approximately 20.66% to close at ₦7.30 per share from ₦6.05.
AVA Capital followed with a gain of 17.74%, closing at ₦7.30 per share. Caverton Offshore Support Group advanced 17.07% to ₦4.80.
These increases showed that equities continued to attract buyers despite broader market weakness.
On the losing side, UPDC Real Estate Investment Trust recorded the steepest decline among the reported stocks. Its share price fell 17.26% to ₦17.50 from ₦21.15.
Omatek Ventures dropped 12.50% to ₦1.40, while University Press declined 12.12% to ₦4.35.
These movements demonstrate why investors need to examine individual companies alongside broader market trends.
Despite the latest losses, the Nigerian stock market retained a positive return for the year. Its year-to-date return stood at 58.87% as of October 23, according to the reported figures.
Analysts at InvestData Consulting Limited expect the market to remain cautious in the near term.
They noted that investors must balance protecting existing gains against opportunities in selected equities.
They also warned that continued selling in banking, energy and other influential stocks could prolong market consolidation.
Further weakness in large-capitalisation companies could weigh on the benchmark index, even if selected equities record gains.
Corporate earnings, dividend expectations and company valuations will remain important considerations.
Strong financial results may attract buyers, while disappointing earnings or uncertain business conditions could encourage further selling.
International developments may also influence sentiment. Rising crude oil prices, partly linked to geopolitical tensions in the Middle East, could support Nigeria’s export earnings and government revenue.
However, higher oil prices may also increase fuel costs, inflationary pressure and business expenses.
Ultimately, the Nigerian Exchange enters the new trading week facing a test of investor confidence.
The increase in declining stocks suggests that weakness has spread across a wider range of equities.
Nevertheless, the strong year-to-date return shows that investors have retained substantial gains despite the recent setback.
Market participants will watch whether buying interest returns to major stocks or investors continue securing profits.
For now, corporate earnings, economic conditions and investor sentiment are likely to influence the market’s direction.
