The Nigerian stock market opened the week on a negative note, with investors engaging in profit-taking activities that led to a loss of N72.5 billion. The market capitalization dropped by 0.11%, closing at N67.346 trillion compared to N67.418 trillion at the start of trading. This decline was primarily driven by sell-offs in Guaranty Trust Holding Company (GTCO) and 41 other stocks 1.
Despite the bearish trend, some stocks have shown remarkable resilience, with six companies recording an average year-to-date (YTD) gain of 83.2%. These include Eterna Plc, Presco Plc, SCOA Plc, Vitafoam, Chellaram Plc, and Honeywell Flour Mills. Their performance reflects strong investor confidence in these companies, even as the broader market experiences volatility 1.
Analysts attribute the profit-taking to cautious investor behavior ahead of the Monetary Policy Committee (MPC) meeting, where a potential interest rate cut is being speculated. The rates on Nigeria’s treasury bills have been declining steadily, with the one-year bill dropping to 25.2% from 29.2% earlier this year. This has prompted fixed-income investors to rethink their strategies 1.
The Nigerian Exchange Limited (NGX) has been working to stabilize the market by introducing measures to boost liquidity and investor confidence. However, external factors such as global economic uncertainties and local inflationary pressures continue to weigh on market performance.
In the long term, experts believe that the market will rebound, driven by strong corporate earnings and improved macroeconomic conditions. The Central Bank of Nigeria (CBN) is also expected to implement policies that will support economic growth and stabilize the financial markets
