080910: Market Capitalisation drops by 107.58 billion, as investors seek alternative investment.

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080910: Market Capitalisation drops by 107.58 billion, as investors seek alternative investment.

Nigerian Capital market continued the slid inherited from last week; investors started the week with cautious and wary attitude which eventually resulted into divesting activities, seeking alternative investment instruments within the market.

The (FG bonds and others) in the market recently increased the weak equity bargains as investors find haven for their hard earned funds in fixed income investment.

All Share Index dipped by -0.65% on Monday to start the week on a bearish note as volume and value dropped profusely. Unwillingness and low enthusiasm that transpired on Tuesday continued the downward movement as Market Capitalization dipped by N40.93 billion against investor’s stake to close index below 24,000 line, trading at figures recorded in March 2010, precisely six months back.

Trading activities on Wednesday closed the week on ‘sell and cash out’ note as the Nigerian Capital Market recorded aggregate loss of 107.58 billion for week, depleting YTD market performance further to 14.22%

Unclear investor’s perspective about the market trend coupled with fear of investment depletion heightened the divesting tendency as share price recorded continuous price dropping across the board; consequently more losers were recorded daily during the week.

The current trend is not unconnected to over bearing and spill over effect of sell pressure initiated by sell off traders that dominated the market in the month of August to meet September 1^st 2010 dead line. This will continue to plunge share prices as there is not enough financial muscle to absorb the excess float in the market.

The week under review recorded three trading sessions, the last two days was marked for public holidays to observe Eid-el-Fitri. Hence, the week closed on Wednesday for long weekend.

In the week, Seven-Up Bottling Company Plc rewards investors with cash and bonus dividends in 2010 Audited result (http://www.proshareng.com/news/singlenews.php?id=11959)

Guinness Nig Plc declared a cash dividend of NGN8.25k for its 2010 Financial Year suggesting a yield of 5.03% when compared with previous of N7.50 declared 2009.

In the same vein, CUTIX Plc proposed final dividend of 12kobo while C & I Leasing also proposed 20kobo final for its financial year ended 30^th January 2010, Closure Date is 20th -24th September 2010. Law Union & Rock Insurance Plc proposed 3kobo for audited year ended December 2009, Closure Date is 13th -17th September 2010.

AIICO Plc during the week announced its audited result for period ended 31st December 2009 with gross premium growth of 0.21% and PAT growth of 67.1%.

In an effort to re-establish investor confidence and maintain code of conduct in the market, during the week, the Management of the Nigerian Stock Exchange (NSE) sanctioned 54 quoted companies for evasion of post-listing requirements. (http://www.proshareng.com/news/11979)

Also, during the week the Nigerian Stock Exchange (NSE) gave approval for the merger of Dangote Cement Plc and Benue Cement Company Plc (BCC). The new entity is now known as Dangote Cement Company Plc. A total of 15,494,019,668 Ordinary Shares of 50k was approved at N135.00 each. The merger arrangement was described as one of the largest transactions ever done in the history of the Exchange. (http://proshareng.com/news/11978)

A significant upward movement of AP share price raised investor’s concern during the week. The price moved upward gradually by 54.81% in eleven trading days from N21.20 on August 20th closed at N32.82 as at September 6th. To have full details of the gist please follow the link. (http://www.proshareng.com/news/singlenews.php?id=11971)

All NSE sectoral index closed the week in negative position, NSE 30 dropped by -1.62%, NSE food and & beverages closed with -0.58%, NSE banking recorded the highest drop by -2.70%, NSE Insurance declined by -1.22% and Oil & Gas index closed the week with -1.28%

However, the All-Share Index in the week under review dropped by -1.81% to close at 23,802.79 as against decline of -0.13% recorded last week to close at 24,241.84

In the same vein, the market capitalization in the week recorded dropped by N107.58 billion (US$729.15 million) to close at N5.83 trillion (US$ 39.53 billion) as against depreciation by N3.62 billion (US$24.59 million) recorded last week to close at N5.94 trillion (US40.25 billion).

The total volume traded in the week closed at 591.85 Million units valued at N4.96 billion (US$33.65 million) compared with 1.44 billion units valued at N11.94 billion (US$80.96 million) exchanged in 32,965 deals last week. The volume transaction in the week when compared with the previous week data dropped by -58.99% as against volume growth by 20% recorded last week. Weekly value however dropped by -58.43% as against appreciation of 15.13% recorded last week.

The lead volume traded in the banking sector is evident in the table above with seven of the top ten trades being banking stocks. Zenith Bank Plc lead the market volume for the week to displace Guaranty Trust Bank Plc shares which topped the transactions volume chart last week.

The volume traded in the top ten most traded stocks for the week represented 53.49% of the entire market volume transactions and their total value accounted for 50.33% of the market value.

As usual, banking sector emerged the most traded sector in the week in terms of volume. The volume traded in the sector this week alone closed at 303.987 million units valued at N2.22 billion exchanged in 9,650 deals compared with 722.028 million units valued at N6.42 billion exchanged in 17,411 deals in the preceding week. The volume traded in the sector accounted for 51.36% of the entire market compared with 50.03% of the ratio recorded last week.

The sector’s volume transaction was mainly boosted by trading in the shares of the banks in the top-ten category.

Insurance sector followed with 79.63 million units valued at N80.38 million exchanged in 884 deals compared with 255.226 million units valued at N322.268 million exchanged in 1,532 deals in the sector last week. Law Union Plc stocks emerged the most traded stock in the sector with 19.59 million units valued at N9.8 million exchanged in 85 deals.

INDEX MOVEMENTS

NSE All-Share Index opened the week on a bearish note with -0.65% depreciation. Consequently, due to the risk aversion in the market, the same trend continued till Wednesday as market consequently closed on negative note with -0.48% appreciation.

In the week under review, all NSE- sectoral Index closed negative as NSE Banking depreciated most by -2.70%.

Top 10 Gainers of the week

The number of gainers in the week down to twenty seven (27) compared with forty three (43) appreciations recorded last week. First Aluminium Plc led the gainers’ chart with +13.40% appreciations. Other gainers in the top ten appreciation class are outlined below.

Top 10 Losers of the week

Fifty two (52) stocks recorded price decline of different magnitude in the week under review compared with Fifty one (51) stocks that declined in the previous week. UPL Plc topped the losers chart for the week with -24.00% depreciation. Other losers in the top ten classes are outlined below.