NGX witnesses bearish position as CBN hikes benchmark interest rate

The nation’s equities market recorded a bearish position, following the benchmark interest rate that was increased by the Monetary Policy Committees meeting of the Central Bank of Nigeria (CBN) on Tuesday.

Losses in Accesscorp, MTN Nigeria, United Bank for Africa (UBA) and International Breweries made the market into the negative position.

The Monetary Policy Rate (MPR) which is the benchmark interest rate was increased to 14 per cent, while the Cash Reserve Ratio (CRR) was held at 27.50 per cent and Liquidity Ratio was retained at 30 per cent.

The All-Share Index (ASI) of the Nigerian Exchange Ltd. (NGX) decreased by 0.02 per cent to 52,308.88 points from 52,319.94 points posted on Monday.

Consequently, the year-to-date gain of the index fell to 22.46 per cent.

Analysts at Vetiva Dealing and Brokage said, “Following the decision of the Central Bank of Nigeria to raise the Monetary Policy rate by 100bps, we are likely to see further bearish sessions as investors continue to trade cautiously.”

Also, the market capitalisation decreased by N59.66 billion to N28.21 trillion from N28.21 trillion at the previous session.

Performance across sub-sector gauges was largely positive.

The NGX Insurance Index, NGX Oil/Gas Index and the NGX Industrial Index rose by 0.86 per cent, 0.79 per cent and 0.19 per cent respectively, while the NGX Banking Index and the NGX Consumer Goods Index fell by 0.41 per cent and 0.13 per cent respectively.

The market breadth was equal as 16 stocks advanced and 16 stocks declined.

RTBriscoe dominated the gainers’ table in percentage terms, gaining 10 per cent, to close at 44k per share.

Glaxosmith followed with 9.02 per cent to close at N6.65 while Cornerstone Insurance rose by 6.45 per cent to close at 66k per share.

Courtville Business Solution garnered 6.38 per cent to close at 50k, while FTNCocoa appreciated by 6.06 per cent to close at 35k per share.

On the other hand, Multiverse led the losers’ chart in percentage terms, dropping 9.50 per cent to close at 17k per share.

Japaul Gold followed with a decline of 7.41 per cent to close at 2k, while Academy Press lost seven per cent to close at 14k per share.

Caverton lost 6.57 per cent to close at 9k per share, while UPDC dropped by 4.03 per cent to close at 5k.

Conversely, market activity was mixed as the volume of stocks traded gained by 76.85 per cent to 205.64 million units.

Transactions in the shares of United Bank for Africa (UBA) topped the activity chart with 74.28 million shares worth N556.84 million.

Accesscorp followed with 16.09 million shares valued at N146.45 million, while AIICO traded 14.1 million shares worth N8.9 million.

FBN Holdings sold 12.82 million shares valued at N140.5 million, while GTCO transacted 8.88 million shares worth N190.49 million.