The Premium-Board listed stocks on the Nigerian Exchange Limited (NGX) witnessed significant sell-offs on Wednesday, indicating investors’ response to Tuesday’s MPC outcome.
By the end of trading, the stock market experienced a decline of 1.27 percent, with the NGX All Share Index (ASI) reaching a new low of 99,302.56 points, down from the previous day’s high of 100,582.89 points. Additionally, the value of listed stocks decreased to N54.317 trillion, resulting in a year-to-date return of 32.80 percent.
Premium stocks such as MTNN, Dangote Cement, Access Corporation, UBA, Seplat, and FBNH were prominently offered for sale on Wednesday morning, impacting their prices on the Nigerian Bourse.
In total, investors exchanged 396,228,353 shares worth N5.826 billion in 10,549 deals. Notably active stocks included Transcorp, Access Corporation, UBA, Zenith Bank, and Universal Insurance.
The market’s downturn reflected a shift in asset allocation strategies by portfolio managers towards higher-yield fixed income instruments over equities, driven by the Monetary Policy Committee’s decision on Tuesday to raise the Monetary Policy Rate (MPR) by 400 basis points to 22.75 percent.
Analysts anticipate further bearish sentiment in the equities market due to the higher interest rates, with potential opportunities for savvy investors to capitalize on dividend income and fundamentally sound stocks amid the evolving market dynamics.
