Nigeria Equity Watch | 24 Aug 2015 : Nigerian Blue Chip Stocks Drag Benchmark Index …NSE ASI down 2.2%

Lagos, Nigeria (Capital Markets in Africa) — Bearish bets on DANGOTE CEMENT (-4.0%), ZENITH (-6.5%) and NIGERIAN BREWERIES (-1.7%) extended the losing course of the Nigerian stock market today. As a result, the benchmark index declined 2.2% to 29,214.13pts bringing YTD loss to 15.7%, the greatest loss in 6 months. Investors lost N227.7bn to peg market capitalization at N10.0tn at the close of market. Likewise, market activity declined as value and volume traded shed 43.9% and 25.5% to N2.8bn and 257.7m units respectively.

The Banking Index Takes the Deepest Dive
All sector indicators but the Oil & Gas index trended southwards in line with the overall market performance. ZENITH (-6.5%), GUARANTY (-2.1%) and UBN (-5.0%) drove a 3.2% depreciation in the Banking index. The Industrial index waned 1.9% largely on the back of bearish sentiment on DANGOTE CEMENT (-4.0%). The Insurance index swung back to negative performance, down 1.6% as MANSARD (-5.0%) and AIICO (-3.6%) recorded price depreciation. The Consumer Goods index also closed in red as NIGERIAN BREWERIES (-1.7%) and PZ (-9.7%) resulted in a 1.2% decline in the index. However, the Oil & Gas index rose 0.5% against the backdrop of appreciation in FORTE OIL (+4.6%).

Pessimistic Market Mood Deepens
Today’s performance reflects the negative sentiments that have persisted in the Nigerian equities market. Market breadth (advancers/decliners ratio) settled at 0.2x as 9 stocks advanced while 46 stocks declined. Top gainers were PAINTCOM (+9.1%), WEMABANK (+8.8%) and FLOURMILL (+5.0%) while top losers were PZ (-9.7%), VONO (-8.8%) and TRANSCORP (-7.2%). We hold on to our advice to investors on taking medium to long term positions as headwinds continue to bedevil the equities market in the short term.