Profit-Taking Ends NGX Market Rally

The Nigerian stock market (NGX)started the new trading week on a softer note on Monday as widespread profit-taking in major equities wiped ₦76.56 billion off investors’ wealth, bringing the market’s recent rally to a pause.

The Nigerian Exchange Limited (NGX) All-Share Index slipped by 0.05 per cent to close at 247,238.74 points, while market capitalisation declined to ₦159.51 trillion. Despite the modest setback, the Nigerian stock market has still posted a strong 58.88 per cent year-to-date return and a 7.8 per cent gain so far this month.

The decline was largely driven by losses in heavyweight stocks, including BUA Cement, Access Holdings, International Breweries, Oando and Fidson Healthcare. Access Holdings fell 7.5 per cent, International Breweries dropped 9.9 per cent, Oando lost 4.3 per cent, BUA Cement declined 2.5 per cent, while Fidson Healthcare shed 9 per cent as investors locked in recent gains.

Selling pressure spread across most sectors. The Insurance Index recorded the sharpest decline, falling 1.69 per cent, while the Consumer Goods Index lost 1.07 per cent. The Commodity, Oil and Gas, and Industrial Goods indices also closed lower. In contrast, the Banking Index rose 0.78 per cent as renewed buying interest lifted banking stocks.

Market breadth remained negative, with between 31 and 32 stocks closing lower compared with 26 to 27 gainers, reflecting cautious investor sentiment across the market.

Among the biggest losers were Transcorp Power, International Breweries, Fidson Healthcare, Neimeth International Pharmaceuticals and Austin Laz & Company. On the gainers’ list, Thomas Wyatt Nigeria and Lasaco Assurance each gained 9.9 per cent, while Consolidated Hallmark Insurance, Chams Holding Company and Capital Market Finance Company also posted solid advances.

Trading activity produced mixed results. Total trading volume declined by 15.1 per cent to 480.02 million shares, valued at ₦51.12 billion across 63,980 deals. Access Holdings recorded the highest trading volume with about 47.6 million shares, while Aradel Holdings led the value chart with transactions worth approximately ₦27.57 billion.

Market analysts said the decline mainly reflected profit-taking in stocks that had rallied strongly in recent weeks rather than any significant weakening of market fundamentals. They added that while the market could recover after the modest pullback, continued selling in recently appreciated stocks may slow the pace of any rebound.

Do you expect the NGX to resume its rally after this round of profit-taking?