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Alarm Bells Ring As NGX Kicks Off 2024 with A Whopping N638 Billion Loss, Raising Concerns Among Investors

Published

2 years ago

January 11, 2024

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The Nigerian Exchange Limited (NGX) faced a setback at the start of the year as investors witnessed a decline in market capitalization, marking the first downturn in 2024…..CONTINUE READING

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Closing trading on Wednesday, the market capitalization saw a notable reduction of approximately N638 billion, settling at N44.885 trillion.

reversal followed a recent achievement where the market cap had crossed the N45 trillion threshold.

Despite the All-Share Index, the exchange’s benchmark, maintaining a position above 80,000 points, it experienced a decrease of 1,167.46 points or 1.40%, concluding at 82,024.38 on Wednesday.

The banking sector felt the impact of the depreciation, with most stocks registering losses.

Jaiz Bank defied the trend, appreciating by 5.40% to N2.93, while Stanbic IBTC Holdings remained unchanged.

Notably, the market capitalizations of Access Holdings Plc and First Bank of Nigeria Holdings dropped below N1 trillion, just a day after surpassing this milestone.

They closed the market session with capitalizations of N989 billion and N926 billion, respectively.

The decline coincided with the Economic and Financial Crimes Commission (EFCC) questioning Managing Directors of certain banks regarding a fraud discovery at the Ministry of Humanitarian Affairs and Poverty Alleviation.

Key drivers of the market during this period included Transnational Corporation Plc, AccessCorp, United Bank for Africa, Jaiz Bank, and Zenith Bank.

Market Breadth, reflecting investor sentiment, turned negative with 13 gainers and 61 losers. Cadbury Plc led the gainers, with a 9.92% increase to N19.95 per unit, driven by its announcement of seeking shareholders’ approval to convert a N7.036 billion loan into equity.

Other companies experiencing gains included VeritasKap (9.76% increase), Linkage Assurance (8.70% gain), Transcorp Hotel (7.24% increase), and Prestige Assurance (6% gain).

On the flip side, Chams Holdings, Cornerstone Insurance, FTN Cocoa, May & Baker, Caverton, and Consolidated Hallmark Holding Plc all suffered losses, each experiencing a 10% decrease.

Transcorp, AccessCorp, and Guaranty Trust Holding Company Plc played pivotal roles in driving market trends in terms of volume and value.

Despite the overall downturn, the transaction volume for the day increased to 1,641.28 million units of shares, valued at N25.37 billion, traded in 20,223 deals, with a total of 123 stocks traded on Wednesday.