Nigerian Equities Pulls Back After Previous Gains, As Custodian Leads Gainers Despite Broad Selloffs

Market Update- August 16,2025

The Nigerian equities market ended Tuesday’s session on a bearish note, reversing part of Monday’s modest rebound as profit-taking activities dragged key blue-chip stocks lower. The NGX All-Share Index (ASI) dipped 0.08 percent to close at 141,546.80 points from 141,659.00 points previously. This decline resulted in a ₦70.99 billion loss in investors’ wealth, pulling the total market capitalisation down to ₦89.56 trillion. The year-to-date (YTD) return also moderated slightly, now standing at 37.52 percent, reflecting a softer upward momentum compared to previous sessions.

Index and Market Capitalisation

Tuesday’s pullback underlines investors’ cautious stance as they react to recent price gains and await fresh catalysts to sustain upward momentum. Despite the minor drop, the overall market remains firmly positive for 2025, supported by strong YTD performance. This suggests that while investors are taking profits on some positions, market fundamentals are still broadly supportive of equities, particularly in fundamentally strong names trading at attractive valuations.

Mixed Sector Indices

Sectoral performance was mixed as different indices moved in opposite directions. The banking index led the day’s decline as profit-taking in UBA, Fidelity Bank, and Zenith Bank dragged the sector lower. The consumer goods index also slipped into negative territory, weighed down by declines in Dangote Sugar and Nigerian Breweries. On the flip side, the insurance index advanced, buoyed by strong demand for Custodian Insurance, which continues to attract investor interest and reached a new 52-week high. The industrial goods and energy indices were largely flat as investors stayed on the sidelines, waiting for clearer market direction.

Technical Analysis

From a technical standpoint, the NGX-ASI has maintained its position above the key psychological level of 140,000 points, which now serves as a major support level. The index’s 20-day moving average remains upward sloping, indicating that the medium-term trend is still bullish despite short-term volatility. However, momentum indicators such as the Relative Strength Index (RSI) are hovering around the neutral zone, signaling a possible consolidation phase if selling pressure persists. Should the market break below the 140,000 support level, the next significant support is seen around 138,500 points. Conversely, a sustained rally could see the index retesting its recent high of 142,500 points, which remains the immediate resistance level.

Market Outlook

Looking ahead, market analysts expect mixed trading to persist as investors weigh profit-taking opportunities against attractive entry points in fundamentally strong stocks. Bargain hunting is likely to drive activity in the short term, particularly if prices dip closer to support levels. The release of corporate earnings and key macroeconomic data will also play a crucial role in determining market sentiment in the coming weeks. A stable exchange rate, improving inflation outlook, and anticipated monetary policy adjustments could further influence investor positioning, especially in banking and consumer goods stocks.

Globally, rising crude oil prices could also provide a positive backdrop for the Nigerian market, given the country’s reliance on oil revenues. Brent crude gained 1 percent on Tuesday to settle at $68.11 per barrel, while U.S. WTI rose 1.3 percent to $64.12 as Ukrainian drone strikes on Russian oil terminals and refineries raised fears of potential supply disruptions. Russia’s pipeline operator, Transneft, has warned producers of possible output cuts if damage to infrastructure continues. According to JP Morgan analysts, these strikes are aimed at curbing Russia’s export capacity, potentially tightening global supply and supporting oil prices. This may benefit oil-related revenue for Nigeria and strengthen investor sentiment toward energy-linked stocks.

Top Gainers, Losers and Trading Activity

Market breadth closed negative, with 27 decliners outpacing 23 gainers, confirming the day’s bearish tone. UBA led the losers’ chart with a 2.28 percent decline, followed by Fidelity Bank, which dropped 2.14 percent, while Dangote Sugar, Nigerian Breweries, and Zenith Bank posted smaller losses of 0.58 percent, 0.36 percent, and 0.29 percent respectively. On the gainers’ side, Custodian Insurance emerged as the star performer, hitting a fresh 52-week high at ₦44.80. Multiverse, ETranzact, and Eunisel also impressed, trading at new highs and maintaining their bullish momentum.

Trading activity was relatively subdued compared to the previous session, with total volume falling 25.25 percent to 414.98 million units valued at ₦12.94 billion across 25,386 deals. GTCO remained the most actively traded stock both by volume and value, contributing 7.93 percent of market volume with 32.89 million units worth ₦3.12 billion. NSLTECH and UBA followed with 7.83 percent and 6.32 percent of the day’s traded volume respectively. GTCO also dominated value traded, accounting for 24.14 percent, ahead of MTNN and Zenith Bank.