The Nigerian Exchange Limited’s market capitalization fell for the first time in the new year.
The market’s eight-day surge came to an end on Wednesday, when the market cap fell by around N638 billion to close at N44.885 trillion. This comes just one day after the market cap surpassed N45 trillion.
Although the All-Share Index, the exchange’s benchmark, maintained over 80,000 points, it fell 1,167.46 points, or 1.40 percent, to settle at 82,024.38 on Wednesday.
Banking equities were impacted by the depreciation, with the exception of Jaiz Bank, which defied the trend and increased by 5.40 per cent to N2.93 and Stanbic IBTC Holdings which closed flat.
Meanwhile, a day after the lenders passed the N1 trillion mark, the market capitalization of Access Holdings Plc and First Bank of Nigeria Holdings fell below N1 trillion. They closed the market with respective capitalizations of N989bn and N926bn.
The drop in the stock market comes a day after the Economic and Financial Crimes Commission questioned some bank Managing Directors about a scam discovered at the Ministry of Humanitarian Affairs and Poverty Alleviation.
The stocks of indigenous conglomerate, Transnational Corporation Plc, AccessCorp, United Bank for Africa, Jaiz Bank, and Zenith Bank were the primary drivers of the day’s market.
Market Breadth, a measure of investor sentiment, was negative, with 13 gainers and 61 losers.
The gainers were headed principally by Cadbury Plc stocks, which rose 9.92% to N19.95 per unit. The consumer products firm announced on Tuesday that it intends to seek shareholder approval to convert a N7.036bn loan from its parent company, Cadbury Schweppes Overseas Limited, to equity.
Cadbury Schweppes Overseas loaned $23 million to Cadbury Nigeria between February 2021 and September 2023 to help settle outstanding third-party loans that the company had obtained to fund its raw material imports and other input costs, according to an explanatory statement filed with the NGX.
However, due to the country’s foreign exchange difficulties, it was unable to satisfy its debt obligations, prompting the board to recommend the debt-to-equity conversion plan.
Other gainers include VeritasKap, which gained 9.76% to close at N0.45, Linkage Assurance, which gained 8.70% to close at N1.50, Transcorp Hotel, which gained 7.24% to conclude at N100 a unit, and Prestige Assurance, which gained 6% to close at N0.53 per unit.
Chams Holdings, Cornerstone Insurance, FTN Cocoa, May & Baker, Caverton, and Consolidated Hallmark Holding Plc lead the losers’ table, losing 10% apiece to settle at N2.16, N1.80, N1.98, N5.49, N2.07, and N1.35 per unit, respectively.
Transcorp, AccessCorp, and Guaranty Trust Holding Company Plc were the volume and value drivers of the day’s market trend.
Despite the market’s fall, the day’s transaction volume increased to 1,641.28million, from the previous day’s volume of 1,409.85 million units of shares valued at N25.37bn from 20,223 deals executed. The number of stocks traded on Wednesday stood at 123.
