NGX Loses N1.40tn as Bears Take Control of the Market
Bears dominated trading on the Nigerian Exchange Limited last week as the market suffered a sharp pullback, erasing about N1.40 trillion in market value and signaling a shift in investor sentiment toward caution and profit-taking.
The benchmark All-Share Index (ASI) declined by 1.11 per cent, closing the week at 192,826.78 points, while market capitalisation fell 1.12 per cent to N123.763 trillion from the prior week’s N125.164 trillion, underscoring mounting selling pressure across major equities and defensive positioning by investors.
Trading activity weakened noticeably as total turnover dropped from 7.662 billion shares worth N252.566 billion in the previous week to 5.494 billion shares valued at N196.709 billion.
Despite a higher number of deals executed, the sharp fall in traded volume and value reflects a hesitancy among market participants to take new positions amid waning momentum and heightened profit-taking at elevated price levels.
Sector-wise, the Financial Services Industry remained the most active, accounting for 3.241 billion shares valued at N82.775 billion, or nearly 59 per cent of total equity turnover volume, showing that banks and insurers still attract significant investor interest even in downturn phases. The Oil and Gas and Services industries followed but with much lower contributions.
Market breadth tilted negative as 69 stocks declined compared with 32 gainers, a reversal from the prior week where more equities recorded gains, highlighting the broad-based nature of the sell-off.
Among stocks bucking the downtrend, Fortis Global Insurance Plc led the gainers with a 56.67 per cent increase, followed by Okomu Oil Palm Plc and Infinity Trust Mortgage Bank Plc, while Associated Bus Company Plc topped the losers with a 25 per cent drop.
Analysts attribute the pullback to profit-taking after a sustained rally earlier in the month, with some market watchers pointing to subdued liquidity and a cautious investor stance amid mixed economic signals.
Although markets had rallied strongly earlier in February contributing to a sizeable year-to-date return of nearly 24 per cent, the late-month correction suggests traders are increasingly selective, focusing on stocks with strong fundamentals and defensive characteristics.
Read Also: NGX Rally Adds ₦1.7 Trillion as Banking, Industrial Stocks Drive Broad Market Surge
The downturn comes amid broader trends in market participation. Recent reports show foreign transactions plunged sharply, with overseas investor activity dropping significantly month-on-month, a dynamic that may have exacerbated the recent decline on the NGX.
In summary, last week’s bearish performance on the NGX reflects a market undergoing short-term risk aversion and profit-taking, coupled with lower trading activity and negative market breadth. While selective gains in certain counters offer pockets of resilience, the broader equity market outlook remains cautious as investors digest recent gains and recalibrate portfolios in response to evolving economic conditions.
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