Bear-Run Deepens Correction On Nigerian Bourse, As Investors Lose N326bn Amid Profit Taking Pressure
The Nigerian Exchange (NGX) extended its losing streak into Tuesday’s session as profit-taking continued to weigh on the market on a day when the country’s Central Bank voted at its policy meeting to cut its benchmark rates in reaction to the apparent improvements in macroeconomic conditions, particularly the sustained slide in inflation. The day opened on a cautious note as traders and portfolio managers reacted to Monday’s selloffs, triggering further declines in major blue-chip and mid-cap counters. Market sentiment remained weak as investors locked in gains from the recent rally, especially in bellwether stocks that had enjoyed significant price appreciation over the past weeks.
The CBN’s Monetary Policy Committee (MPC), at its 302nd meeting which ended on September 23, attended by all 12 members, according to the communiqued, voted to reduce Monetary Policy Rate (MPR) by 50 basis points to 27%; adjust the Standing Facilities corridor around the MPR to +250/-250 basis points; and the the Cash Reserve Ratio for commercial banks to 45%, while retaining that of merchant banks at 16%. It also introduce a 75% CRR on non-Treasury Single Account public sector deposits; while keeping the Liquidity Ratio unchanged at 30%.
The communique added that the “decision to lower the monetary policy rate was predicated on the sustained disinflation recorded in the past five months, projections of declining inflation for the rest of 2025, and the need to support economic recovery efforts. Adjustment of the Standing Facilities corridor, it noted, is to improve the efficiency of the interbank market and strengthen monetary policy transmission, stressing that the newly introduced 75% CRR on non-TSA public sector deposits was for enhanced liquidity management.
Meanwhile, Tuesday’s session on the NGX was dominated by sell pressure in heavyweights such as DANGSUGAR, which hit a 10.00% decline to top the losers’ chart, alongside WEMABANK, ACCESSCORP, ARADEL, WAPCO, GTCO, and NEM Insurance, all of which contributed meaningfully to the day’s negative close.
Consequently, the composite NGX All-Share Index (ASI) shed 0.40% to close at 140,929.60bps from the previous 141,498.44bps, translating to a ₦326.17bn loss in market capitalisation, and bringing the total valuation of listed equities down to ₦89.20trn. The year-to-date (YTD) return, which had remained strong for most of the year, eased to 36.92%, signaling a cooling-off phase in the market’s bullish run.
The sectoral performance for the day presented a mixed picture, as profit-taking was most pronounced in the Banking, Industrial Goods, and Insurance sectors, which dragged their respective indices lower. The Consumer Goods sector also closed weaker due to the sharp selloff in DANGSUGAR and mild declines in Nigerian Breweries, further compounding the market’s negative breadth. Interestingly, despite the global oil market rebound, the Oil & Gas index closed flat, as investors stayed on the sidelines pending further clarity on crude production levels, fiscal adjustments, and subsidy-related policies that could influence listed energy firms’ earnings.
Globally, the oil market offered some positive sentiment as crude prices gained over $1 per barrel, a development that has the potential to support revenues for oil-exporting economies such as Nigeria. Brent crude futures rose 1.8% to $67.75 per barrel, while West Texas Intermediate (WTI) climbed 2% to $63.55 per barrel by midday trading. These gains came after talks to resume pipeline exports from Iraq’s Kurdistan region to Turkey stalled, easing fears of oversupply in the short term. The resumption of about 230,000 barrels per day of exports has been delayed, as producers demand guarantees for debt repayments before restarting flows. For Nigeria, higher crude prices could help boost FX inflows and government revenues, factors that investors will watch closely as they price in future earnings for oil and gas players on the NGX.
From a technical perspective, the NGX All-Share Index remains in a corrective phase following a strong uptrend in previous weeks. The index currently hovers just above a key psychological support level around 140,200 points, which if breached, could see further declines toward the next support band at 139,500 points. On the upside, immediate resistance remains around 142,000 points, which will need to be broken convincingly for the bulls to regain control. Technical indicators such as the Relative Strength Index (RSI) and Money Flow Index (MFI) are gradually approaching oversold territory, suggesting that a potential relief rally or bargain-hunting phase may be near. However, the current market structure signals caution, as momentum indicators still favor sellers in the short term.
Looking ahead, the market is expected to remain choppy in the near term as investors continue to digest macroeconomic data, interest rate adjustments, and global market cues. Quarter-end portfolio rebalancing could also drive increased volatility, with institutional investors likely to reposition into select sectors that offer earnings resilience and dividend yield. Bargain hunters may take advantage of this correction to accumulate fundamentally strong stocks, particularly in the banking and industrial sectors, where valuations are beginning to look attractive again. The outlook remains cautiously optimistic, as sustained positive sentiment in the oil market, coupled with potential policy clarity, could provide a catalyst for renewed buying interest going into the final trading sessions of the quarter.
Despite the market’s weak close, trading activity was vibrant as turnover rose sharply. Total traded volume jumped 55.37% to 759.08 million units, while value traded climbed to ₦25.73bn across 23,657 deals, indicating strong participation by institutional and retail investors. ZENITHBANK dominated both volume and value charts, accounting for 13.76% of market turnover and ₦6.91bn or 26.87% of total value traded. FIRSTHOLDCO and FIDELITYBK also saw significant activity, contributing 13.30% and 6.92% of total daily volume respectively, reinforcing the dominance of banking stocks in market liquidity.
Market breadth closed negative with 34 decliners against 15 gainers, led by DANGSUGAR (-10.00%), followed closely by WEMABANK (-8.27%), ACCESSCORP (-4.98%), and ARADEL (-4.76%), reflecting aggressive profit-taking in these counters. On the positive side, THOMASWY topped the gainers’ chart, while CHELLARAM and CUSTODIAN hit fresh 52-week highs at ₦16.00 and ₦48.30 respectively, showing that selective buying interest still exists in pockets of the market.
