Stock market loses ₦1.166tn in sell-off

Nigerian equities market lost ₦1.166 trillion in a single session, reversing a four-session bullish run amid sell-offs in key stocks.

The Nigerian Exchange Ltd. (NGX) equities market on Tuesday reversed its four-session bullish run, losing N1.166 trillion in market capitalisation amid sell-offs in key stocks. Market capitalisation fell by 0.73 per cent from N160.421 trillion to N159.255 trillion, while the All-Share Index (ASI) shed 1,806.18 points to close at 246,723.57.

The market’s year-to-date return also declined to 58.55 per cent, despite the positive breadth, which recorded 28 gainers against 27 losers. Thomas Wyatt Nigeria led the losers, declining 9.97 per cent to close at N2.89, followed by AVA Capital, which fell 9.60 per cent to N8.95.

Despite the dip, trading volume surged to 3.909 billion shares valued at N32.38 billion in 45,608 deals, compared with 1.137 billion shares worth N27.02 billion exchanged on Monday. Fortis Global Insurance dominated trading, accounting for 3.29 billion shares worth N9.58 billion.

The market correction is a reminder that bulls cannot run forever. The sell-off in key stocks suggests profit-taking after a sustained rally. Investors who bought at the peak are now nursing losses, while those who sold earlier are counting their gains.

This echoes the 2021 market correction, which also saw a reversal after a sustained rally. The mechanism then was different, but the result was the same: a reminder that markets are volatile.

The winners: investors who sold before the correction; and the Nigerian Exchange, which remains active. The losers: investors who bought at the peak; and the Nigerian economy, which relies on a stable capital market.

Bottom Line: The stock market has lost ₦1.166 trillion in a single session. The bulls have run out of steam. The question is whether the correction will deepen or reverse.