Stock Market Down N1.83tn WoW on MPR Hike, Poor Corporate Earnings

The Nigerian equities market predominantly exhibited bearish performance last week, dropping by N1.83 trillion in market capitalisation following the Monetary Policy Committee (MPC) hike in Monetary Policy Rate (MPR) to 22.75 per cent and poor 2023 corporate earnings by some listed companies.

The overall market capitalisation decreased by N1.83 trillion to close at N54.035 trillion from N55.861 trillion it opened the week, while the NGX All-Share Index shedding 3.27 per cent WoW to 98,751.98 basis points from 102,088.30 basis points it opened for trading.

Last week witnessed losses declared by MTN Nigeria Communications Plc, Dangote Sugar Refinery Plc, among other companies with investors’ sentiment trading rocking the local stock market. The Nigerian stock market is expected to witness return of positive movement this week as investors expect more companies to release their full-year 2023 audited accounts in the coming days. The prevailing market sentiment was largely influenced by weaker than expected corporate earnings releases and the initiation of the dividend earnings season in the face of the fixed income market’s higher yields outlook, fueled by recent auctions, which contributed to the mildly negative market breadth.

Furthermore, the recent rate hike by the monetary policy committee prompts ongoing portfolio rebalancing among market participants. Also, the local bourse’s recent performance underscores the dynamic interplay of market forces amidst evolving economic conditions.

It reflected in sectoral front performance last week as the NGX Insurance and NGX Industrial Goods indices bore the brunt of the downturn, experiencing losses of 3.40 per cent and 3.87 per cent respectively.

Similarly, the NGX Consumer Goods, NGX Oil & Gas, and NGX Banking sectors witnessed declines of 2.62 per cent, 1.55 per cent, and 0.69 per cent respectively.

The market breadth for the week was negative as 27 equities appreciated in price, 54 equities depreciated in price, while 72 equities remained unchanged. Juli led the gainers table by 60.26 per cent to close at N3.75, per share. PZ Cussons Nigeria followed with a gain of 27.36 per cent to close at N33.75, while Sterling Financial Holdings Company went up by 14.94 per cent to close to N5.00, per share.

On the other side, MTN Nigeria Communications (MTNN) led the decliners table by 18.91 per cent to close at N200.70, per share. SUNU Assurance and Nestle Nigeria followed with a loss of 18.18 per cent each to close at N1.71 and N900.00 respectively.