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nerPostTitle">MARKET BACK TO NEGATIVE LEVELS Written by furtune Business Mar 2, 2010

Market back to negative levels
By Daniel Osunkoya
March 2, 2010 12:46AM The nation's equity market which had appreciated marginally by 0.33 per cent or N18 billion on Wednesday eventually went back to its downward slope. The market capitalisation of the Nigerian Stock Exchange (NSE), last week, lost over N44 billion or 0.79 per cent, to close at N5.535 trillion from the N5.579 trillion it opened with on the first trading day of the week. The stock market opened for four days as Friday was declared public holiday in commemoration of Eid el-Maulud.

The NSE All-Share Index also closed lower at 22,985.00 basis points from the 23,168.64 it opened with on Monday, representing 0.79 per cent decrease. The NSE had, in the previous week, rebounded by 0.9 per cent.

Reviewing the market performance for the week, Proshare Nigeria Limited, an investment management firm, in an analysis posted at its website, said three of the four trading days in the week recorded negative performances because the positive outlook recorded on Wednesday could not be sustained.

Uncertainty remains
The analysis said, 'The market trend could be attributed to the yet cloudy investment climate in the country coupled with the political confusion that has besieged the country since the president left the country about four months ago. Even with the news making the round of the return of the president, the situation remains as it were; as nobody knows what is likely to follow.'

Arguing that the negative trend may continue for a longer period, Tunde Oladapo-Dixon, the Chief Executive Officer of StockPicks Consulting, a stock broking firm, said, 'You can't say the market is bearish anymore because it's in a zigzag trend now; the market will go up and come down.' Mr. Oladapo-Dixon said that the capital market, with the illiquidity challenges, is expected to experience bullish and bearish trends occasionally because 'investors' confidence level is still very low.'

Low turnover
At the close of last week's transaction, a turnover of 1.5 billion shares worth N9.83 billion in 27,756 deals was recorded, in contrast to a total of 1.73 billion shares valued at N10.84 billion exchanged in the preceding week in 34,256 deals. The turnover also included a total of 1,000 units of Lagos State Fixed Rate Redeemable Bond worth N1.1 million.

The Banking subsector was the most active during the week, in terms of turnover volume, with 813.51 million shares worth N6.5 billion exchanged by investors. Volume in the subsector was largely driven by activity in the shares of Ecobank Nigeria, FinBank, and Zenith Bank. Trading in the shares of the three Banks accounted for 272.35 million shares, representing 33.5 per cent of the subsector's turnover.

The Insurance subsector, boosted by activity in the shares of Standard Alliance Insurance and Universal Insurance Company, followed on the week's activity chart with a turnover of 230.03 million shares valued at N177.03 million.

Gainers and losers
At the close of trading last week, a total of 34 stocks appreciated in price, lower than 47 the preceding week. African Petroleum led on the gainers' table with a gain of N7.96 to close at N47.46 per share, while Chemical and Allied Products followed with N3.96 to close at N29.74 per share.

On the flip side, a total of 70 stocks depreciated in price during the week, higher than the 50 of the preceding week. Nigerian Breweries led on the price losers' table, shedding N3.00 to close at N57.00 per share, while BOC Gases followed with a loss of N1.11 to close at N10.39 per share

Bond market
At the bond market last week, a turnover of 308.04 million units worth N378.244 billion in 4,297 deals was recorded, in contrast to a total of 368.82 million units valued at N433.337 billion exchanged in 5,388 deals in the preceding week.

Measuring by turnover volume, the most active bond was the 4th Federal Government of Nigeria (FGN) Bond 2014 Series 11 which traded 40.15 million units valued at N48.331 billion. This was followed by the 6th FGN Bond 2029 Series 3 with 33.7 million units valued at N48.497 billion. Only 19 of the available 38 FGN Bonds were traded during the week, compared to 17 in the preceding week.