NGX Falls by 1.27% as Traders ‘Protest’ CBN Rate Hike

By Dipo Olowookere

The decision of the Central Bank of Nigeria (CBN) to push the anchor interest rate higher by 4.00 per cent to 22.75 per cent from 18.75 per cent on Tuesday had a toll on the Nigerian Exchange (NGX) Limited on Wednesday.

Yesterday, the stock market lost 1.27 per cent after investors cut down their exposure to equities in reaction to the monetary policy announcement of the apex bank a day earlier.

The bourse suffered selling pressure during the session, seeing all the major sectors closing in the red territory, with the banking index falling by 6.90 per cent.

The insurance sector went down by 3.72 per cent, consumer goods space depreciated by 1.20 per cent, and industrial goods counter declined by 0.411 per cent, while the energy space closed flat.

The profit-taking pulled down the All-Share Index (ASI) by 1,280.32 points to 99,302.57 points from 100,582.89 points, and the market capitalisation contracted by N701 billion to N54.337 trillion from N55.038 trillion.

Business Post reports that only five stocks ended on the gainers’ table in the midweek session led by PZ Cussons, which appreciated by 10.00 per cent to N29.15.

Juli rose by 9.93 per cent to N3.10, AXA Mansard grew by 1.53 per cent to N5.30, NAHCO expanded by 0.69 per cent to N29.00, and NPF Microfinance Bank jumped by 0.55 per cent to N1.84.

Yesterday, the NGX recorded 52 price losers led by Wema Bank, Oando, Nigerian Breweries, The Initiates, and Red Star Express, which lost 10.00 per cent each to settle at N7.02, N9.90, N30.60, N1.80, and N3.42, respectively.

This showed that investor sentiment was grossly weak and the market breadth index was negative.

A total of 396.2 million equities worth N5.8 billion were transacted in 10,549 deals compared with the 280.5 million equities worth N6.1 billion exchanged in 9,141 deals on Tuesday, indicating a fall in the trading value by 4.92 per cent, and a rise in the trading volume and the number of deals by 41.25 per cent and 15.40 per cent, respectively.

Transcorp topped the activity chart as the most active after trading 52.6 million shares valued at N675.6 million, UBA traded 39.5 million equities worth N823.9 million, Access Holdings exchanged 35.3 million shares valued at N620.9 million, Zenith Bank sold 30.9 million stocks for N1.0 billion, and Universal Insurance traded 23.2 million equities worth N8.1 million.