The Nigerian equity market dipped by N89 billion on Wednesday following the Central Bank of Nigeria’s decision to hike interest rates.

Both the all-share index and market capitalization plunged by 0.16 percent to 98,128.00 basis points and N55.509 trillion, respectively.

This downturn caused the market’s year-to-date return to moderate to 31.23 percent, reflecting the impact of the MPC’s decision on investor sentiment.

Among the top gainers at the close of trading were Tantaliser, Wapic, Omatek, Julius Berger, and Wapco. Conversely, TIP, Multiverse, Cornerst, and Deapcap led the laggards, showcasing the uneven performance across different sectors.

Accesscorp emerged as the most traded stock by volume, with 35.57 million units traded in 606 deals, while GTCO took the lead as the most traded security by value, amounting to N1.35 billion in 403 deals.

The market’s sectoral performance was also mixed, with two out of five sectors closing positively, two closing negatively, and one remaining flat.

The banking and insurance sectors experienced losses of 2.01 percent and 0.87 percent, respectively, due to portfolio rebalancing by investors following the MPC’s decision.

In contrast, the oil and gas sector remained unchanged, while the industrial and consumer goods sectors saw marginal increases of 0.18 percent and 0.02 percent, respectively.

Analysts from Meristem expressed their outlook, anticipating continued lackluster sentiment in the equities market following the MPC’s contractionary stance.

However, they also expect buying interest to surface in stocks trading at attractive entry points, particularly as the sell-off pressure in the banking sector is projected to ease in the near term.

The market’s reaction underscores the sensitivity of investors to monetary policy decisions and highlights the importance of closely monitoring regulatory actions for their impact on market dynamics and investment strategies.

Nigeria’s equities market managed to close on a positive note despite the cautious sentiments lingering after the Monetary Policy Committee (MPC) decisions.

Nestle Nigeria Plc emerged as the star performer, leading the gainers’ chart and driving the market’s appreciation by 0.11%.

The market capitalisation gained N61 billion, the highest gain since the beginning of the week.

This upward momentum was fueled by increased investor interest, particularly in Nestle Nigeria Plc, Berger Paints Plc, and other penny stocks like Royal Exchange Plc.

Investors displayed confidence in Nestle Nigeria Plc, making bullish moves ahead of its annual meeting scheduled for the following day.

This optimism translated into substantial buy-side activities, contributing significantly to the overall positive performance of the market.

Despite the outcomes of the two-day MPC meeting, where the Central Bank of Nigeria (CBN) intensified tightening measures to combat inflation, investors remained undeterred.

The MPC’s decision to raise the policy rate by 150 basis points (bps) to 26.25% and retain other monetary policy parameters did not dampen investor enthusiasm.

Shares of key players like GTCO, Access Holdings, UBA, Transcorp, and Jaiz Bank were actively traded, reflecting the heightened activity in the market. In a total of 7,228 deals, investors exchanged 222,899,152 shares valued at N5.148 billion.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation both witnessed an uptick from the previous trading day’s lows, closing at 98,285.33 points and N55.597 trillion respectively.

Nestle Nigeria Plc saw a notable increase from N820 to N900, marking a substantial gain of N80 or 9.76%.

Berger Paints also experienced a positive trajectory, rising from N13.55 to N14.90, adding N1.35 or 9.96% to its value.

Similarly, Royal Exchange, a penny stock, saw an increase from 56 kobo to 60 kobo, reflecting a gain of 4 kobo or 7.14%.

The market’s ability to close in positive territory on Tuesday further bolstered the year-to-date (YtD) return, which now stands at an impressive 31.44%.

Despite the uncertainties surrounding MPC decisions and macroeconomic concerns, investor optimism and strategic investments continue to drive Nigeria’s equities market forward, showcasing resilience in the face of challenges.

The Nigerian equity market closed in the red on Tuesday as the benchmark index plummeted to levels last seen in January.

The All-Share Index (ASI) dropped to 97,473.98 points, mirroring the bearish sentiment that prevailed earlier in the year.

Similarly, the market capitalization of listed stocks also experienced a sharp decline, falling to N55.132 trillion, a level reminiscent of the market’s performance in January when it reached N55.583 trillion.

This decline marks a stark reversal from the bullish trend that characterized the latter part of 2023 and spilled over into the early months of 2024.

Analysts had long anticipated a correction in the market, citing the unsustainable nature of the rally driven largely by sentiment rather than fundamental economic or market improvements.

David Adonri, a seasoned stockbroker, described the previous bullish run as sentiment-driven, noting that while the equities market had recorded impressive gains of 39.84 percent in the first quarter of 2024, it lacked substantial support from economic or market fundamentals.

Despite efforts to reignite investor interest through corporate actions and announcements, such as the Central Bank of Nigeria’s plans for a recapitalization exercise, the market struggled to maintain momentum.

Other investment avenues offering better yields further diverted attention away from equities.

The day’s trading session saw notable declines in the share prices of key players such as Dangote Sugar and PZ Cussons, both recording a 10 per cent drop, extending their stay on the losers’ chart.

The Initiates Plc, a waste management firm, also witnessed a similar decline in its share price.

Trading activities painted a gloomy picture as total deals, volume, and value all depreciated significantly compared to the previous day.

Sectoral performance reflected the overall bearish sentiment with declines observed in banking, insurance, and consumer goods indices.

While the industrial goods index saw a marginal rise, the oil and gas sector remained stable amidst the turmoil.

AccessCorp emerged as the most traded security by volume, while GTCO led in traded value, highlighting investor interest in specific stocks despite the market-wide downturn.