Uncertainty in the global economy space and profit-taking activities, gave investors on the floor of the Nigerian Exchange Limited (NGX) a N213 billion haircut at the close of transactions in the month of March.
Last February however, the NGX had gained about N419 billion on the back of return on investments (ROIs) from companies that released their 2021 Full Year (FY) earnings forcing analysts to project that the rally would be sustained in the trading month of March.
Regrettably, the market capitalisation of listed equities depreciated by N213 billion from an opening value of N25.524 trillion to close at N25.311 trillion, while the All Share Index (ASI) also fell, 395.21 points or 0.8 per cent from 47,360.79 to 46,965. 48 points.
But some NGX sectoral index and capitalisation saw green in March 2022. Specifically, the Fixed Income market capitalisation sector which closed the month of February 2022 at N21.099 trillion, rising by N328.080 billion to close at N21.427 trillion, representing a 1.55 per cent increase in response to corporate earnings.
Similarly, Exchange Traded Funds (ETFs) market capitalisation went up from N21.106 trillion in February by N327.870 billion to N21.434 trillion in March.
Similarly, Premium Board capitalisation appreciated by 0.73 per cent and closed at N11.703 trillion from N11.619 trillion in February, representing an increase of N84.433billion, while the ICT rose up from N4.759 trillion in February to close at N4.761 trillion.
Similarly, the Oil and Gas sector index was up 3.79 per cent, the best performing index compared to other sectors. Whereas, the NGX Lotus Islamic Index up by 1.46 per cent; NGX Premium Index up by 1.73 per cent and NGX Meri Growth Index up by 1.44 per cent.
Speaking on the market performance, the Chief Operating Officer of InvestData Consulting Limited, Ambrose Omordion, said the stock market sustained positive sentiments and uptrend due to the influx of corporate actions and 2021 audited financials, as players reacted to the released numbers and dividend declared for year-end 2021 earnings in February.
Omordion noted that due to economic data in relationship with crude oil price and other factors, in the midst of profit-taking and portfolio rebalancing, the market clearly interpreted the events which resulted in the decline recorded in the NGX market capitalization.
For their part, analysts at Cordros Capital, weak sentiments are expected to dominate the local bourse as investors continue to scale down exposure to equities following the mark down of share prices for 2021 FY dividends amidst expectations of uptick in FI yields. “Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings”, they said.
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