By Peter Egwuatu

Investors in the stock market have lost over N1.3 trillion on the Nigerian Exchange Limited, NGX, following the further raise in Monetary Policy Rate, MPR, by the Central Bank of Nigeria, CBN, to 26.75% from 26.25% last week.

Analysts explained that with the fresh increase in MPR, investors started moving their funds from stocks to fixed income securities.

A review of the market performance last week showed that market capitalisation which represents investors’ value on the Exchange dropped to N55.6 trillion from N56.9 trillion.

In similar manner, the NGX All Share Index, another stock market guage, dropped by 2.3% to close at 98,201.49 points from 100,539.40 points the previous week.

The market experienced increased sell pressures across industrial goods, consumer goods, and banking stocks, as profit-taking activities in Dangote Cement led to the decline in its price by 10.0% followed by , UBA 7.9%, First Bank Nigeria Holdings, FBNH 4.8% and Da gote Sugar 7.3% to trigger the decline in All Share Index, Week on Week, W/W.

Consequently, the Month-to-Date and Year-to-Date returns settled at -1.8% and +31.3%, respectively.
From a sectoral perspective, losses in the Industrial Goods, index by (5.9%), Banking Index 2.9%, Consumer Goods Index 0.7%, Oil and Gas Index 0.5% , and Insurance Index 0.3 % reflected the overall market performance.

Reacting on the market performance and outlook, analysts at Cordros Research stated: “While the recent decision of the MPC may further suppress investors’ sentiments in the near term, we anticipate that the ongoing H1’24 earnings season will ultimately guide market’s direction over the short-term.”

In their reaction, analysts at Comercio Partner Research stated: “The local stock market displayed a bearish stance as the benchmark All-Share Index dipped. So we expect a similar session this week.”