The Nigerian equities market closed August on a bearish note, shedding N587 billion in market capitalisation amid weak investor participation and disruptions linked to the transition to a new settlement structure.
Market capitalisation, which opened the month at N158.326 trillion, declined by 0.37 per cent to close at N157.739 trillion.
Similarly, the All-Share Index (ASI) fell by 1,084.29 points, or 0.44 per cent, from 245,283.68 at the beginning of the month to 244,199.39 at the close of trading.
The market recorded 13 sessions of losses against seven sessions of gains during the 20 trading days in August.
Despite the decline, trading volume rose by 50.8 per cent, with investors exchanging 26.867 billion shares valued at N634.801 billion in 899,053,057 deals.
This compared with 17.817 billion shares valued at N1.184 trillion in 1,166,154 deals recorded in July. Value traded declined by 46.4 per cent, while the number of deals fell by 22.9 per cent.
Managing Director of Wyoming Capital and Partners, Mr Tajudeen Olayinka, attributed the subdued performance partly to disruptions arising from the implementation of the new settlement structure, which affected the participation of some key investors, particularly foreign investors.
Olayinka said the new system, which required investors to pre-fund transactions, initially affected market activity as investors adjusted to the new settlement cycle.
He, however, said subsequent adjustments to the system had helped restore confidence and improve liquidity, including the extension of the deadline for settlement-related debit alerts from noon to 5 p.m. the following day.
The market expert expressed optimism that improved liquidity and renewed investor participation toward the end of August could support stronger performance in September.
He said institutional investors would be particularly important to the market’s recovery, noting that their participation had a significant influence on liquidity and overall market direction.
Despite the overall bearish performance, several banking stocks recorded gains during the month. First HoldCo rose from N129.55 to N145 per share, United Bank for Africa from N44.50 to N47.35, Zenith Bank from N123.55 to N127.40, Access Holdings from N26.30 to N32.10 and Guaranty Trust Holding Company from N130 to N133.
Seplat Energy also gained from N11,363.90 to N12,320.60, while Eterna rose from N33 to N35.80 per share.
Among the major decliners were Aradel Holdings, which fell from N1,526.80 to N1,415, Oando from N36.60 to N34, RT Briscoe from N12.60 to N11.40 and MTN Nigeria from N837 to N807 per share.
Insurance and pharmaceutical stocks also recorded notable declines during the month.
With settlement-related concerns gradually easing, investors will closely monitor September trading to determine whether the late-August recovery can develop into a sustained rebound.
