The Nigerian stock market has recorded a downturn performance, closing lower in three of the five trading sessions last week, as investors reacted to the previous week’s lower-than-expected inflation data, which triggered a selloff in banking stocks.
It would be recalled that the National Bureau of Statistics, NBS, in the previous week Thursday announced an adjusted inflation rate to 24.48% from 34.80 percent December 2024, while Central Bank of Nigeria, CBN, retained the Monetary Policy Rate, MPR, at 27.5%, apparently to still attract foreign investors to bring in foreign currencies.
The apex bank had consistently explained that the steady increase in MPR in 2024 was due to the continuous rise in inflation rate, reports Vanguard.
The NBS’ reduction in inflation rate was as a result of the recent rebasing of the Consumer Pricing Index, CPI.
Meanwhile, stock market activity details last week, showed that the sell pressures on Ecobank Transnational Incorporated, ETI, led to significant drop in its price by -12.4% and GTCO -2.9%, weighing down on market performance and driving the Nigeria Exchange Limited, NGX All-Share Index (ASI) lower by 0.6% Week on Week, W/W to close at 107,821.39 bases points from 108,497.50 bases points the previous week.
In the same vein, investors lost over N421billion W/W, as market capitalisation, which represents the total value of listed stocks on the Exchange, declined to N67.193 trillion on Friday from N67.614 trillion the previous week.
Meanwhile, on Month on Month trading analysis, investors gained over N2.48 trillion as market capitalisation rose to N67.193 trillion from N64.709 trillion at the end of January 2025.
In similar vein, NGX ASI rose by 3.2% to close the end of February 2025 at 107,926.50 points from 104,496.12 points the previous month.
Consequently, the Month-to-Date, MtD and Year-to-Date, YtD returns moderating to +3.2% and +4.8%, respectively.
Trading activity W/W was mixed, as trading volume declined by 8.2% while trading value advanced by 3.2%.
Sectoral performance was broadly negative, as the Insurance Index declined by -4.6%, Banking Index -3.1% , Industrial Goods Index -0.5 and Consumer Goods Index -0.4% indices, while the Oil & Gas Index appreciated by 0.6% to be the sole gainer of the week under review.
Commenting on market outlook, analysts at Cordros Research stated: “Looking ahead, we expect cautious trading, with market sentiment likely to be influenced by ongoing corporate earnings releases and dividend announcements”.
