Stock Market Drops by N813bn on Profit-taking in BUA Foods

Kayode Tokede

The stock market section of the Nigerian Exchange Limited (NGX) depreciated by N813billion last week amid profit-taking in BUA Foods Plc, MTN Nigeria Communication (MTNN) Plc, BUA Cement Plc and Airtel Africa Plc.

The NGX All-Share Index dropped by 0.52 per cent week-on-week (WoW) to close at 250,808.27 basis points, while the market capitalisation fell by N813 billion to close the week at N162.843 trillion.

Despite the decline in the headline index, underlying market breadth remained positive, with 44 gainers against 37 losers. ABC Transport led the gainers table by 45.10 per cent to close at N7.40, per share. Critical Minerals Financing Corp followed with a gain of 37.73 per cent to close at N4.49, while Livingtrust Mortgage Bank went up by 32.69 per cent to close to N3.45, per share.

On the other side, Sovereign Trust Insurance led the decliners table by 12.50 per cent to close at N2.10, per share. e-Tranzact International followed with a loss of 12.00 per cent to close at N11.00, while Learn Africa declined by 11.05 per cent to close at N7.65, per share.

Overall, a total turnover of 3.166 billion shares worth N155.023 billion in 206,662 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 4.689 billion shares valued at N240.824 billion that exchanged hands previous week in 261,198 deals.

The Financial Services Industry led the activity chart with 1.944 billion shares valued at N77.733 billion traded in 92,035 deals, contributing 61.41 per cent and 50.14 per cent to the total equity turnover volume and value respectively.

The Investment Industry followed with 409.484 million shares worth N5.400 billion in 1,444 deals, while the ICT Industry pulled a turnover of 231.705 million shares worth N9.606 billion in 24,133 deals.

Trading in the top equities, Fidelity Bank, VFD Group and Access Holdings accounted for 1.343 billion shares worth N27.580 billion in 15,771 deals, contributing 42.42 per cent and 17.79 per cent to the total equity turnover volume and value respectively.

The Nigerian stock market is expected to remain cautious and volatile this week as investors continue to lock in profits following strong year-to-date gains.

Analysts expected cautious trading to persist, but noted that resilience in market breadth could support interest in lagging counters with strong fundamentals.

On market outlook, Cowry Assets Management Limited said, “we expect the market to remain cautious and volatile in the near term, as investors continue to lock in profits following the strong year-to-date gains.

“Nevertheless, the market’s positive breadth points to underlying resilience and could encourage selective bargain-hunting, particularly in fundamentally sound counters that have lagged the broader market rally.”

The firm also said, market direction is likely to be influenced by the trajectory of corporate earnings, evolving macroeconomic conditions, system liquidity, interest-rate expectations, and overall investor sentiment.

Against this backdrop, Cowry added that “we expect investors to remain selective, with greater preference for stocks offering attractive valuations, resilient earnings profiles, sustainable dividend capacity, and credible growth prospects. This could result in continued sector and stock rotation as investors balance profit-taking against opportunities emerging from recent price corrections.”

Also, Cordros Securities Limited said, “we expect market activity to remain choppy and largely range-bound in the near term, given the lack of a meaningful catalyst to spur buying interest.”