Investors lose over N856bn in March as market cap falls below N30trn mark

NIGERIA’S stock market recorded a negative performance in the month of March as a N856.97 billion loss to investors brought the total market value below the N30 trillion mark.

Total market value, also known as market capitalisation, dropped to N29.54 trillion on March 31, after it opened at N30.40 trillion on March 1.

The All-Share Index (ASI) also fell by 2.82 per cent to 54,232.34 basis points (bps), from 55,806.26bps in the review March.

The oil & gas, and banking and insurance indices contributed to the negative performance recorded in the month of March.

Notably, the oil & gas index fell by 9.65 per cent to 510.83bps; the banking index dropped by 2.95 per cent to 452.97pbs; while the insurance index declined by 1.14 per cent to 177.51bps.

A look at the stocks table for the banking sector showed that Stanbic IBTC shares dipped by N4.1 to N37.60; Zenith Bank, by 0.65k to N25.85; and United Bank for Africa, by 0.35k to N8.35.

On the oil & gas sector, Seplat Energy lost N175 to close at N1,150; while Conoil lost N8.85 to close at N38. Also, on the insurance sector, AXA Mansard Insurance’s shares dropped by 0.1k to N1.90, while AIICO Assurance fell by 0.02k to 0.58k.

Although the capital market was at a loss in March, it, however, returned a 5.81 per cent or N1.63 trillion to investors in the first quarter (Q1).

In January, investors gained N1.08 trillion after the market opened at N27.915 trillion, and they pocketed N1.40 trillion in February after the market opened at N28.997 trillion, despite the jitters that followed the 2023 general elections.

Nigeria’s electoral umpire, the Independent National Electoral Commission (INEC), had conducted presidential/senatorial elections on February 23 and governorship/state house of assembly elections on March 11.

Elections in Africa portend a risk of conflict, protests, policy uncertainty and ultimately a lack of clarity around investments within the region, the Chief Executive Officer of the Nigeria Stock Exchange (NGX), Temi Popoola, had said during the 2022 Market Recap and 2023 Outlook, held on January 25.

“The February general elections in Nigeria could prove pivotal in redefining the nation’s investment narrative following its recently challenged spell,” he said, but expressed optimism that 2023 was likely to be the dawn of a new day for the equities market and the broader Nigerian economy.

    During an election period, people show less interest in taking investment risk, Abel Ezekiel, an investment and portfolio analyst, told The ICIR.

    Ezekiel attributed the Q1 positive performance to the position investors took towards companies’ fourth quarter earners, especially those that did “reasonably well” in previous quarters.

    He was also of the view that the Central Bank of Nigeria’s (CBN) cashless policy could have contributed in raising investment appetite in stocks.

    As the market repositions for the new trading quarter and gradually transits into the dividend earning season, analysts at Cowry Asset Management, in their weekly financial market review and outlook for March 31, expect the current trend of positive sentiments and uptrend to continue in the week to come.

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