Equities Market Records Marginal Fall on Profit Taking

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Goddy Egene

The stock market recorded a marginal decline yesterday as some investors moved in to take profit after days of surge in prices of equities. The sustained rally had on Wednesday pushed the market capitalisation to N20.281 trillion, the highest in the history of the local bourse.

However, the market declined to N20.279 billion, indicating a margin fall of N2 billion, while the Nigerian Stock Exchange (NSE) All-Share Index (ASI) fell from 38.803.74 to 38,800.01. Although there more price gainers than losers, the absence of bellwethers such as Dangote Cement Plc, Airtel Africa Plc, MTN Nigeria Plc, BUA Cement Plc, Zenith Bank Plc, GTBank Plc among others gainers made the market to close negatively.

A total of 23 stocks appreciated, while only eight depreciated. Champion Breweries Plc led the price losers with 7.8 per cent, trailed by Lafarge Africa Plc and Jaiz Bank Plc with 4.7 per cent apeice. AIICO Insurance Plc shed 3.0 per cent, while May & Baker Nigeria Plc and Cutix Plc went down by 1.3 per cent 0.9 per cent respectively.

On the positive side, FTN Cocoa Processors Plc led the price gainers with 9.8 per cent followed by LASACO Assurance Plc with 9.6 per cent. Skyway Aviation Handling Company Plc and Japaul Gold and Ventures Plc gained 9.2 per cent and 9.0 per cent in that order.

Other top price gainers include: Oando Plc (9.0 per cent); AXA Mansard Insurance Plc (8.2 per cent); CAP Plc (7.6 per cent); Honeywell Flour Mills Plc (6.9 per cent); Flour Mills of Nigeria Plc (5.0 per cent) and Chams Plc (4.5 per cent).

Market analysts believe the rally will continue after the Christmas break till the end of the year. According to analysts at InvestData Consulting, there have been positive sentiments for value, growth and highly capitalised stocks with attractive valuation, as investors reposition for year-end seasonal trends and the much expected economic recovery in 2021.

“The bull run shows that smart money is still in the market. The ongoing Santa Claus rally is attributed to window dressing for year-end among institutional investors, even as bonuses are entering the market ahead of the New Year, as some investors are taking advantage of the tax code by selling positions they have taken losses at the end of December to buy-back in January,” they said.

They noted that although, the inflationary trend remains a source of serious concern across the country, the equity market has so far provided a safe haven, remaining the only investment window that has outperformed inflation.