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Nigeria: Stock market loses N298 billion in September

The Nigerian Stock Exchange recorded a total loss of N298.491 billion on equities at the close of trading activities in September, blaming “investor pessimism” and “decline in corporate performance” on the downturn.

Nigeria Stock Market

The market value of the 215 listed equities, which opened the month at N5.946 trillion, closed on the last trading day of September at N5.648 trillion, reflecting N298.491 billion losses or a 5.02 percent decline. Also, the NSE All-Share Index, which opened the month at 24,268.24 basis points dropped to its 8-month low, closing at 23,050.59, a decline of 1,217.65 units or 5.02 percent.

The Exchange’s information department said the stock market sustained the declining trend “largely to investor pessimism,” adding that “decline in corporate performance and the increased returns on money market investments” also contributed to the losses recorded.

The NSE also said that the decline in market capitalisation in September can be attributed to the decline in the prices of most equities.

Meanwhile, David Amaechi, an executive member of the Shareholders Association of Nigeria, said, “The illiquidity state of the market coupled with the effects of the massive selloffs of banks’ shares” that dominated the market in August, continued to affect the confidence of investors, especially retail investors.

Quoted banks were given till September 1 to reduce their shares exposure to the capital market, in a bid to comply with the Central Bank’s directive.

The market recorded a turnover of 4.84 billion shares valued at N47.25 billion in 117,366 deals during September, in contrast to a total of 5.3 billion shares valued at N46.91 billion exchanged during August in 142,594 deals.

Consequently, while the value of trades rose by 0.7 percent when compared with August, trading volume and the number of deals dropped by 8.1 percent and 17.7 percent, respectively.

In August, trading volume and value had declined by 31.1 percent and 20.2 percent, when compared with July, while the number of trades increased by 6.2 percent.

Aggregate stock market turnover between January and September 2010 were 72.6 billion shares valued at N589.93 billion, and exchanged in 1,568,631 deals. In the comparable period during 2009, the market recorded turnover of 75.3 billion shares, valued at N508.7 billion in 1,370,384 deals.

In September, the banking subsector was the most active, measured by turnover volume, with traded volume of 2.81 billion shares valued at N22.4 billion, while the insurance subsector was second with traded volume of 481.5 million shares valued at N430.01 million.

The conglomerates subsector was third with transaction volume of 268.15 million, valued at N3.25 billion, while the mortgage companies subsector was fourth with transaction volume of 195.02 million shares, valued at N104 million.

Bond trading

A turnover of 998 million units worth N946.5 billion in 9,146 deals was recorded in September 2010, in contrast to a total of 1.003 billion shares valued at N1.023 trillion billion, exchanged during the preceding month in 11,054 deals.

The most active bond, in terms of turnover volume, was the 10.00 percent Federal Government of Nigeria (FGN) July 2030, with traded volume of 354.25 million units, valued at N310.55 billion in 3,085 deals. It was followed by 4.00 percent FGN April 2015, with a traded volume of 158.35 million units, valued at N131.25 billion in 1,165 deals.