NGX volume plunges 60 percent as selective buying lifts index

ASI gains 0.81 percent on FTSE Russell reclassification catalyst

TRADING activity on the Nigerian Exchange Limited (NGX) contracted sharply, last week, with equity volume falling by 3.74 billion shares, or 59.8 percent week-on-week, even as the benchmark index recovered on renewed buying interest in selected large-cap stocks.

Investors traded 2.507 billion shares worth N123.223 billion in 173,561 deals during the four trading days to August 28, compared with 6.242 billion shares valued at N157.764 billion in 186,496 deals in the preceding week. This means the market lost nearly 60 percent of its weekly volume, while transaction value declined by a more moderate 21.9 percent and the number of deals fell 6.9 percent.

The sharp differential between volume and value suggests that although the number of transactions declined only modestly, the market witnessed significantly fewer shares changing hands. This points to reduced breadth of participation and increasingly selective positioning by investors, rather than a broad return of risk appetite.

This was reflected in the market’s performance. The NGX All-Share Index (ASI) rose 0.81 percent week-on-week to 241,298.47 points, while market capitalisation increased by N1.29 trillion to N155.83 trillion. The gain pushed the market’s year-to-date return to 55.06 percent, although the month-to-date performance remained negative at -1.6 percent.

The positive index performance was largely driven by selected heavyweight counters, particularly in the banking and oil & gas sectors. First Holdco Plc gained 11.58 percent, Seplat Energy Plc rose 10 percent and Access Holdings Plc advanced 9.3 percent, providing significant support to the benchmark.

However, the broader market painted a weaker picture. Fifty-five stocks closed lower against only 24 gainers,…