Banking Stocks Shorten Investors’ Wealth by N17bn

By Dipo Olowookere

Investors in the Nigerian stock market suffered a loss of N17.3 billion on Thursday as a result of the lackluster performance of equities in the banking space.

The Central Bank of Nigeria (CBN) had on Tuesday directed deposit money banks in the country to effect between 2 to 5 percent charges on deposits and withdrawals from the retail and corporate customers from Wednesday, September 20, 2019, in Abuja, Lagos, Rivers, Ogun, Abia and other few states, with the policy, which it called cashless, expected to take effect in all other states of the federation from 2020.

This cashless policy was kicked against by making Nigerians, who felt it was coming at a very wrong time, especially when government was planning to increase value added tax to 7.5 percent from 5 percent next year.

At the stock market yesterday, investors having banking stocks offloaded them, resulting in the 0.13 percent decline recorded by the Nigerian Stock Exchange (NSE).

It pushed the All-Share Index (ASI) lower by 35.46 points to settle at 27,646.15 points and the market capitalization lower by N17.3 billion to close at 13.458 trillion.

An analysis of the sectoral performance showed that only the banking index closed in red on Thursday. The sector went down by 1.50 percent.

The best performance was the insurance sector, which rose by 2.90 percent. The consumer goods index appreciated by 0.62 percent, the energy sector finished 0.14 percent stronger, while the industrial goods index ended 0.06 percent higher.

The volume of transactions reduced yesterday by 35.33 percent to 245.4 million from 379.5 million, while the value of the trades went down by 68.69 percent to N1.7 billion from N5.3 billion.

FBN Holdings was the most traded stock, transacting 71.5 million shares worth N390.1 million, while Sterling Bank followed with 61.6 million equities worth N135.4 million.

UBA traded 12.9 million valued at N81 million, GTBank exchanged 9.2 million worth N268.9 million, while Lafarge Africa sold 9.1 million equities for N140.4 million.

GTBank emerged as the heaviest price loser on Thursday after a loss of 55 kobo to close at N29.25k per unit, while Zenith Bank lost 35 kobo to end at N19 per share.

Access Bank fell by 25 kobo to settle at N7.45k per share, Cutix depreciated by12 kobo to finish at N1.42k per share, while UBA declined by 10 kobo to close at N6.25k per share.

On the flip side, Dangote Sugar topped the gainers’ log after appreciating by 75 kobo to close at N10.55k per share, while UAC Nigeria went up by 70 kobo to finish at N7.75k per share.

PZ Cussons increased by 60 kobo to end at N7.05k per share, Dangote Flour appreciated by 35 kobo to close at N22.40k per unit, while Ecobank rose by 20 kobo to settle at N9 per share.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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