Activity on the floor of the Nigerian Exchange Limited cooled significantly last week as the market operated for only four trading days ahead of the Easter public holidays. With the federal government declaring Friday and Monday as work-free days, investors appeared cautious, resulting in a notable dip in participation.
Total turnover fell to 2.856 billion shares valued at N113.597bn, a sharp contrast to the 3.950 billion shares worth N201.312bn that exchanged hands during the previous full trading week.
Despite the drop in overall volume, the financial services industry maintained its position as the engine of the market. The sector alone contributed more than 63 per cent of the total equity turnover, led by heavy activity in Wema Bank and Access Holdings.
The services and ICT industries trailed in second and third place, respectively, though they remained far behind the banking sector in terms of both volume and total value traded.
Significant corporate actions and capital adjustments also characterised the week. FCMB Group Plc and VFD Group Plc both successfully listed billions of additional shares following a public offer and rights issue, respectively. Notably, FCMB’s public offer saw an impressive 144.89 per cent subscription rate, signalling robust investor confidence despite the broader slowdown in weekly trading activity.
Meanwhile, Universal Insurance announced its intention to join the capital-raising trend, submitting an application for a rights issue of more than 2.6 billion ordinary shares.
While the volume of shares traded retreated, the market’s primary indicators managed to stay in the green. The NGX All-Share Index appreciated 0.39 per cent to close at a historic 201,698.89 points, while the total market capitalisation rose to N129.806tn.
However, beneath these gains, market breadth remained weak as 57 equities depreciated compared to only 29 gainers. This suggests that the index was propped up by select large-cap stocks while the broader market felt the weight of the shortened week.
The NGX All-Share Index has been on a historic bull run, recently crossing the 200,000-point milestone. This surge reflects a 52-week gain of more than 90 per cent, driven by improved foreign exchange liquidity and pro-market reforms.
The listing of FCMB’s 23.18 billion shares, which was 144.89 per cent oversubscribed, and Universal Insurance’s new rights issue are part of a massive industry-wide ‘capital hunt’. Investors are currently reacting to which banks have successfully crossed the finish line and which are still diluting equity to raise funds.
While the headline ASI is up, the fact that 57 stocks declined while only 29 rose indicates a ‘top-heavy’ market. The growth is being driven by a few large-cap heavyweights like Access Holdings and Wema Bank, while smaller stocks in the insurance and consumer goods sectors are struggling under high operating costs.
