Business

Global Market Decline Leads to ₦93 Billion Loss for Nigerian Stocks

Published by Tope Fakinlede on August 6th, 2024.

Global Market Decline Leads to ₦93 Billion Loss for Nigerian Stocks

On Monday, the Nigerian equity market mirrored the broader global market downturn, resulting in a significant decline. The market capitalization dropped by ₦93 billion, bringing the total to ₦55.40 trillion.

The All-Share Index fell to 97,582.41 points, a decrease of 0.17% from the previous close of 97,741.86 points.

Trading activity included 9,738 transactions totaling ₦6.217 billion and 324.02 million shares exchanged. The market breadth was negative, with 23 stocks gaining and 25 experiencing declines.

Top gainers included International Breweries, Presco Plc, and Sovereign Trust Insurance, each seeing a 10% increase to close at ₦4.62, ₦485.10, and ₦0.55, respectively. On the other hand, Chams Plc led the decliners with a 10% drop to ₦1.98. University Press Plc fell by 9.92% to ₦2.18, and The Initiate Plc decreased by 8.26% to ₦2.

The trading volume surged by 54% to 324.02 million shares, and the number of transactions increased by 47% to 9,738. Zenith Bank recorded the highest trading volume with 37 million shares, followed by United Bank for Africa, Veritas Kapital Assurance, and Oando with 35 million, 25.5 million, and 20.3 million shares, respectively.

This downturn in the Nigerian market aligns with a global trend. International stock markets also fell on Monday amid growing concerns about a potential recession in the United States.

Newsweek attributed the market decline to a weak US July payroll report, which showed an increase in the unemployment rate to 4.3%, marking the fourth consecutive monthly rise, and a shortfall in nonfarm payrolls, which grew by only 120,000 versus the anticipated 200,000.

Reuters reported that Mark Dowding, Chief Investment Officer at BlueBay Asset Management, attributed the sell-off to “position capitulation” as macro funds faced unexpected trade losses, particularly in foreign exchange and the Japanese yen.

According to PUNCH, the Nigerian stock market faced a challenging week, with the All-Share Index and market capitalization falling by 0.46% and 0.19%, respectively. The market ended at 97,745.73 points and ₦55.50 trillion, resulting in a ₦438 billion loss.