Caution Still, As Nigerian Exchange Extends Bearish Sentiment, Investors Lose N623bnAmid Global Oil Price Upside
The Nigerian equity market again closed lower on Tuesday, sustaining its bearish momentum for the second consecutive session, as sell pressure across key sectors continues to dampen investor confidence.
The benchmark NGX All-Share Index (NGXASI) lost 0.70% to close at 138,737.64 basis points, compared to 139,722.19 points in the previous session, just as market capitalization shed N622.95bn to close at N87.78trn, dragging year-to-date (YTD) return down to 34.79%.
The bearish outing was largely attributed to sustained profit-taking in bellwether and mid-tier stocks.
Specifically, heavy selloffs were recorded in PZ which lost 9.89%, WAPCO fell 9.88% down, CADBURY lost 8.33%, BERGER 5.26%, WEMABANK, 5.22%, DANGSUGAR 5.17%, and TRANSCORP 4.26%. Others such as VITAFOAM lost 4.21%, HONYFLOUR (-2.31%), ACCESSCORP (-1.34%), UBA (-1.16%), GTCO (-0.54%), and NB (-0.28%) also contributed to the downtrend.
This resulted in a negative market breadth after 47 stocks suffered declines against only 9 advancers.
On the gainers’ chart, NCR topped the list, advancing to a new 52-week high of N12.70, reflecting renewed investor interest, while AUSTINLAZ also rallied to another 52-week high at N3.18. However, AIICO and PRESTIGE closed as the worst-performing stocks of the session, leading the laggards’ chart.
Market Activity
Trading activity remained relatively weak, with total transaction volume down by 0.10% as 407.57m shares valued at N39.87bn changed handsin 31,406 deals. GTCO emerged as the most traded equity by volume, recording 32.61m units (8.00% of total turnover), followed closely by ACCESSCORP (7.25%) and AIICO (5.35%). In terms of value, SEPLAT dominated the chart with trades worth N28.45bn, representing 71.35% of the total value exchanged, while GTCO and ZENITHBANK followed with significant contributions.
The banking sector saw mixed performance, with sell pressure on ACCESSCORP, UBA, and GTCO weighing on the index, while ZENITHBANK recorded relatively stable trading. Industrial goods counters such as WAPCO and BERGER dragged the sector lower, while consumer goods names, notably DANGSUGAR, CADBURY, and NB, also closed weak, reflecting broad-based selloffs.
Technical View and Market Outlook
From a technical standpoint, the NGXASI continues to trade below the 20- and 50-day moving averages, indicating that the market is still in a correction phase. The Relative Strength Index (RSI) has slipped further toward the oversold region, suggesting that selling pressure is becoming extended, even as some counters are trading at attractive entry levels. The Money Flow Index (MFI) also reveals capital flight, with funds exiting risk assets into safer investment classes amid macroeconomic uncertainties.
The candlestick pattern formed in Tuesday’s session reflects a continuation of the bearish trend, confirming weak investor sentiment. However, given the oversold nature of certain stocks, we anticipate bargain hunting to resurface in the coming sessions, particularly in fundamentally sound stocks with strong earnings potential and attractive dividend yields.
For short-term traders, the immediate support levels to watch are around 137,800bps and 136,500bps, while resistance is seen at 140,000bps. A sustained break below support may trigger further downside, but a rebound from current levels could see a mild recovery as bargain hunters reposition. Long-term investors are advised to remain focused on companies with robust fundamentals, strong cash flows, and consistent dividend policies.
Macroeconomic Context
The broader market sentiment remains influenced by Nigeria’s macroeconomic realities, including high inflation, elevated interest rates, and continued FX market volatility. These factors have weighed on investor risk appetite, prompting portfolio rebalancing away from equities into fixed income instruments where yields remain attractive. Nonetheless, the equities market continues to offer pockets of opportunities for discerning investors.
