The market capitalisation of the Nigerian Exchange (NGX) depreciated by N857billion in March 2023 amid political tension, inflationary pressure and scarcity of local currency in the domestic economy.
Nigerians on February 25 and March 18, 2023 went to the polls to decide the leadership of their country, leading to foreign investors exit in some fundamental stocks on the Exchange.
Also, inflation rate, according to National Bureau of Statistics (NBS) increased to 21.91 per cent in February 2023 from 21.82 per cent reported in January and it impacted on investors return on investment in the stock market
Although the stock market in first quarter gained N2.44 trillion in market capitalisation to close on March 31, 2023 at N29.544 trillion from N27.915 trillion at which it opened for trading activities on January 3, 2023, its performance in March dropped by N857billion from N30.401trillion to N29.544trillion it closed for trading.
The overall market performance measure NGX All-Share Index, which tracks the general market movement of all listed equities on the Exchange, rose by 5.11 per cent to close at 54,232.34 basis points in Q1 2023 from 51,595.66 basis points it closed on December 30, 2022.
NGX ASI in the month of March dropped by 2.82 per cent to 54,232.34 basis points from 55,806.26basis points.
The decline was influenced by investors profit-taking in Airtel Africa Plc, MTN Nigeria Communications Plc, and Dangote Cement Plc.
The stock price of Airtel Africa dropped to N1,479.00 per share, a decline of 8.7 per cent from N1,620.00 per share it opened for trading in March while Dangote Cement show its stock price closing March at N270 per share, representing a decline of 2.9 per cent from N278 per share it opened for trading.
The stock price of MTN Nigeria Communication moved to N240.00 per share in March from N245.00 per share it closed in February 2023, representing a decline of 2.04 per cent.
Amid controversies, the stock price of Seplat Petroleum dropped by 13.2 per cent to N1,150.00per share in March from N1,325.00 it closed for trading in February 2023.
However, the sector performance in Q1 2023 was bullish as most indices closed the period on uptrend as at March 31, 2023. NGX Consumer Goods index appreciated the most by 19.32 per cent. NGX Premium Board index followed with a gain of 11.97 per cent, while NGX Oil & Gas index rose by 10.45 per cent.
Others are NGX Lotus II index, NGX Banking index, NGX Pension index, NGX 30, NGX Industrial Goods index and NGX Insurance went up by 8.79 per cent, 8.50 per cent, 6.35 per cent, 4.93 per cent, 2.21 per cent and 1.81 per cent in that order.
Financial analysts noted that the positive sentiment during the period was as a result of change in the holding structure of the market since foreign investors left the market on the grounds of COVID-19 and local investors dominated with increased buying interest due to the better-than-expected corporate earnings post-COVID and higher dividend payouts.