By Nkiruka Nnorom
Investment analysts have said that the downward trend in equities pricing will continue this week following heightened political tension in the country.
Sentiments in the equities market remained bearish last week with all trading sessions closing in negative territory. Consequently, the All Shares Index, ASI, declined by 2.89 percent to settle at 35,446.47 points.
In the same vein, market capitalization decreased by N381.3 billion to N12.9 trillion while activity level waned with average volume and value traded falling 28.6 percent and 57.7 percent to 185.1 million units and N1.7 billion respectively.
According to analysts at Cordros Capital, sell-offs are likely to persist in the absence of a near-term positive trigger and also at the backdrop of the brewing political concerns.
They, however, stated that macroeconomic fundamentals remain stable and are supportive of recovery in the long term.
Corroborating, analysts at Cowry Asset Management said: “This week, we expect the local bourse to close in red territory as political risk continues to weigh on the market prices and the fixed income investment becomes more attractive amid increasing yields.”
However, Afrinvest Securities in its review, said that bargain hunting activities by investors is expected to buoy market performance albeit marginally after a 6-day bearish run.
Review of market activities last week showed that all sectors closed negative, with the oil and gas sector declining the most at 5.4 percent on account of 8.5 percent, 5.1 percent and 0.9 percent losses in Seplat Petroleum and Development Company Plc, Total Nigeria Plc and Oando Plc respectively. The industrial goods sector fell by 4.42 percent following a significant loss in Dangote Cement shares.