NGX extends Bearish trading as ASI down 0.3%

Nigerian Exchange sustained Bearish sentiment for the second trading session of the week, as sell-offs on OANDO (-10.0%), UBA (-5.6%), and FIRSTHOLDCO (-4.2%) dragged the NGX-ASI lower by 0.3% to 114,910.16 points. As a result, Year to date return declined to 11.6% (previously 12.0%), while market capitalisation trimmed by 0.3% to N72.5tn. Meanwhile, activity level improved as volume and value traded rose by 9.1% and 16.6% to 787.3m units and $25.7bn, respectively.
Across sectors performance was mixed as three indices gained while the other three shed weight. Leading the gainers, the AFR-ICT and Insurance indices increased by 1.1% and 0.4% sequentially, due to price uptick in MTNN (+2.5%), AlICO (+3.8%), and MBENEFIT (+ 10.0%). Similarly, buying interest in in WAPCO (+1.1%) lifted the Industrial Goods index by 0.2%. Conversely, the Oil & Gas and Consumer Goods indices topped the laggards, down 1.3% and 0.5% respectively driven by price decline in OANDO (- 10.0%), JAPAULGOLD (-1.0%), INTBREW (-2.8%), and HONYFLOUR (-2.3%). Following, the Banking index fell 0.2%, owing to price depreciation in UBA (-5.6%) and ZENITH (-2.0%).
Investor sentiment, as measured by market breadth, weakened to -0.09 from 0.48x in the previous session as 29 stocks advanced, 35 declined, while 64 closed flat. Notwithstanding the positive inflation print for May (down 72bps to 23.0%), we expect the market to remain bearish tomorrow, as sentiment stays weak due to market knee jack reaction to CBN’s circular to DMBs and profit-booking in other sectors.