Nigeria’s Equities’ Investors Lose N660.3bn Days After CBN’s Rates Hike

By InsideBusiness On Oct 8, 2022

KELECHUKWU MGBOJI

Nigerian equities investors had their stakes trimmed by a whopping N660.3billion about a week after the country’s Central Bank raised its Monetary Policy Rate (MPR) otherwise called interest rate to 15.5 percent and Cash Reserve Reserve Requirement (CRR) to 32.5 percent.

With the aggressive rates hike, equities investors are believed to have migrated to fixed income instruments leaving stocks bleeding. Consequently, market capitalization which measures the value of traded stocks shed ₦660.3billion to ₦25.8trillion week on week, weakening year to date returns to 10.8 percent while the All Share Index which measures the performance of traded equities declined by 3.4 percent week on week to 47,351.43 points.

Trading activities during the week varied as average volume fell 27 percent week on week to 146.7million units while average value traded rose 6.2 percent to ₦2.2billion with additional valuation after the admission of Geregu Energy Plc to the official list of the Exchange.

The top traded stocks by volume were GTCO (152.2m units), STERLING (44.9m units), and ZENITH (42.5m units) while GTCO (₦2.6bn), MTNN (₦844.5m), and ZENITH (₦827.5m) topped the turnover table.

Performance of all the six sectorial indices declined with the AFR-ICT and Banking indices losing 6.6 percent and 3.4 percent week on week respectively due to selloffs in Airtel Africa recording a maximum 10 percent decline, GTCO -4.2 percent, and UBA -3.6 percent.

Price depreciation in Cornerstone of about -10.7 percent, AIICO -5.8 percent, and OANDO -6.2 percent drove the Insurance and Oil & Gas indices down by 1.2 percent and 1 percent respectively week on week.

Likewise, the Consumer and Industrial Goods indices lost 0.6 percent and 0.3 percent week on week respectively due to price decline in CADBURY -9.9 percent, PZ -9.2 percent, and WAPCO -4.1 percent.

A total of 44 stocks recorded losses in the week under review compared with nine stocks that appreciated in prices indicating weakening in investor confidence. A total of 99 stocks remained unchanged in price valuation.

The top performing stocks for the week were MULTIVERSE (+22.0%), LIVESTOCK (+11.8%), and CUTIX (+5.9%) while NASCON (-13.6%), CORNERST (-10.7%), and AIRTELAF (-10.0%) were the top underperforming stocks.