The Nigerian equities market ended last week in the red, as investor sentiment soured following the Central Bank of Nigeria’s (CBN) decision to keep the Monetary Policy Rate (MPR) unchanged at 27.5%.
Market watchers observed that the decision, coupled with profit-taking activities and a shift in capital towards fixed-income instruments, triggered a sell-off in several high-performing stocks.
As a result, the benchmark index—the NGX All-Share Index (ASI)—fell by 0.6%, closing at 109,028.62 points, compared to the previous week’s 109,710.37 points.
Major contributors to the downward trend included notable losses in Transcorp Hotels (-15.0%), Transnational Corporation (-4.4%), Access Corporation (-8.1%), and Fidelity Bank (-10.3%).
Fidelity Bank, in particular, came under selling pressure after reports surfaced about a possible winding-down process related to a court judgment. The bank swiftly responded to the development through an official statement published on the Nigerian Exchange Limited portal on Tuesday.
As a result of the bearish turn, the market’s Month-to-Date (MtD) and Year-to-Date (YtD) performance softened to 3.1% and 5.9%, respectively.
Interestingly, despite the downturn, trading activity saw an uptick. Weekly trading volume and value rose by 43.2% and 11.0%, respectively, suggesting ongoing investor interest in repositioning portfolios.
Sector performance painted a mixed picture. The Oil and Gas Index shed 3.4%, while the Banking Index dropped 1.5%. On the other hand, the Consumer Goods Index gained 2.2%, and both the Insurance and Industrial Goods indices edged up by 0.7%.
Looking ahead, analysts at Cordros Capital anticipate that the market will continue to exhibit cautious sentiment, with profit-taking likely to be balanced by bargain-hunting in undervalued stocks. They noted that broader macroeconomic signals and developments in fixed-income markets would shape investor behavior in the medium term.
Similarly, analysts at InvesData Consulting advised investors to tread carefully, citing the ongoing earnings season, portfolio rebalancing activities, and anticipation of fresh economic policies capable of reigniting growth.
