Akintunde Oyedokun
The domestic equities market reversed its recent positive momentum on Tuesday, as the Nigerian Exchange All-Share Index (NGXASI) witnessed a sharp downturn, reflecting broad-based profit-taking across key sectors. Specifically, the benchmark index declined by 1.46%, closing at 142,613.47 basis points compared to 144,722.47 basis points recorded at the previous session’s close. This downturn erased part of the recent gains and dragged market capitalization lower by ₦1.33 trillion to settle at ₦90.23 trillion, while the year-to-date (YTD) return moderated to 38.56%.
The day’s bearish performance was largely driven by heavy selloffs in bellwether stocks, notably DANGCEM (-9.88%), CAP (-9.72%), ZENITHBANK (-7.26%), OANDO (-7.11%), NEM (-6.51%), NGXGROUP (-6.25%), FIDSON (-4.78%), and GTCO (-2.06%). These losses overshadowed gains seen in other counters, underscoring the dominance of negative investor sentiment. Market breadth closed weak with 37 losers against 25 gainers. On the gainers’ side, ENAMELWA (+9.96%) sustained its uptrend to close at ₦35.90, a fresh 52-week high, while ROYALEX (-10.00%) led the laggards’ chart. Similarly, small-cap stocks such as DAARCOMM, DEAPCAP, and GUINEAINS also advanced to new 52-week highs, closing at ₦1.23, ₦1.94, and ₦1.70, respectively, showing selective buying interests despite the broad market weakness.
Activity levels were also subdued as turnover indicators pointed to weaker participation. Total traded volume dropped by 10.39% to close at 1.03 billion units, valued at ₦17.66 billion, across 34,352 deals. UNIVINSURE emerged the most traded stock by volume with 130.22 million units, representing 12.67% of total market turnover, followed by AIICO (9.74%) and MBENEFIT (6.67%). On the value side, Nigerian Breweries (NB) topped with ₦2.13 billion, reflecting strong investor interest in consumer goods counters despite prevailing market pressures.
Technical Analysis
The index opened the session at 144,722.47 points and closed significantly lower at 142,613.47 points, forming a long bearish candle on the daily chart. This pattern highlights intense profit-taking that weighed on overall market direction. The NGXASI has now slipped below its short-term 5-day EMA, confirming the weakening trend. Furthermore, the Relative Strength Index (RSI) currently stands at 41.15, edging closer to the oversold region, signaling that sellers continue to dominate momentum. However, this also presents a potential entry point for bargain hunters, especially in fundamentally strong and dividend-paying stocks.
The market’s current price action suggests cautious trading, with the possibility of further pullbacks if sell pressure intensifies. Nonetheless, bargain-hunting activities could spark a short-term rebound once prices approach attractive support levels. Key resistance remains at 145,000bps, while immediate support lies around 141,500bps.
Investment Outlook
We maintain a cautious stance in the near term, as the market navigates through profit-taking activities and repositioning by investors ahead of upcoming earnings releases and corporate actions. Long-term investors are advised to focus on fundamentally sound equities with attractive dividend yields and resilient earnings outlook. Meanwhile, short-term traders may explore opportunities in oversold counters and sectors that have shown relative strength.
In summary, while Tuesday’s performance underscores weak sentiment and heavy selloffs in large-cap names, the market still presents selective opportunities for strategic investors who can balance between capital preservation and growth.
Oil prices dropped on Tuesday as hopes of peace talks between Russia and Ukraine raised expectations of eased sanctions and higher global crude supply. Brent settled at $65.79 per barrel, down 1.22%, while U.S. WTI closed at $62.35, down 1.69%.
