Nigeria’s equities market recorded a sharp weekly decline as investors reduced their positions in banking, insurance and industrial stocks ahead of the opening of the Dangote Refinery initial public offering (IPO).
The Nigerian Exchange All-Share Index fell by 1.60% in the week ended September 11, closing at 243,052.74 points compared with 246,992.44 points recorded a week earlier.
The decline translated into a ₦1.97 trillion reduction in market capitalisation, which stood at ₦157.59 trillion at the end of the week. Despite the latest pullback, the market’s year-to-date return remained positive at 56.19%.
Market breadth also weakened considerably. A total of 80 stocks recorded losses during the week, while only nine equities gained, compared with 35 decliners and 56 gainers in the preceding week.
Trading activity declined alongside the market downturn. Investors exchanged 3.65 billion shares valued at ₦130.15 billion, down from the 4.36 billion shares worth ₦210.33 billion traded in the previous week.
Financial services stocks accounted for 79.76% of total market volume, although the sector came under significant selling pressure.
Insurance emerged as the worst-performing sector, declining 5.52%, while the banking sector fell 4.07%. Industrial goods stocks lost 3.36%, and consumer goods companies recorded a 2.42% decline.
Oil and gas was among the few sectors to advance, gaining 2.83%, supported by the performance of Seplat Energy. The commodities index also increased by 2.19% during the week.
NGX Group was the biggest gainer, rising 13.85% to ₦148. Ellah Lakes followed with a 13.33% increase, while Seplat Energy gained 10% to close at ₦14,907.80.
On the losing side, Fortis Global Insurance recorded the largest decline, dropping 27.50% to ₦1.45. Critical Minerals Financing Corporation declined by 24.24%, while Austin Laz fell 20.40%.
Dangote IPO Takes Centre Stage
Market attention is now shifting to the Dangote Refinery IPO, with subscriptions scheduled to open on September 14.
The offering is expected to influence investor liquidity as market participants reassess their portfolios and determine how much capital to commit to the new issue.
The timing also coincides with Nigeria’s scheduled return to FTSE Russell’s Frontier Market classification on September 21. The development could generate additional interest in Nigerian equities, with 31 Nigerian stocks selected for inclusion in the relevant index series.
The two developments could therefore produce different investment flows in the market. Some domestic investors may raise cash to participate in the Dangote Refinery offering, while foreign and index-linked investors position themselves ahead of Nigeria’s reclassification.
The sharp increase in the number of declining stocks, alongside the reduction in overall trading value, suggests that investors were repositioning rather than engaging in a broad increase in market activity.
With the Dangote IPO and FTSE Russell reclassification occurring within the same period, market participants will be watching closely to see how liquidity is distributed between the new offering and existing listed equities.
