By Seun Ibiyemi
The Nigerian stock market extended its bearish run on Thursday, with investors losing N2.179 trillion as sell-offs in fundamentally strong stocks continued amid adjustments to the newly introduced T+1 settlement cycle.
Market capitalisation declined by 1.41 per cent, falling from N154.445 trillion to N152.266 trillion, while the All-Share Index (ASI) shed 3,397.80 points to close at 237,404.92, down from 240,802.72 recorded at the start of trading.
The downturn also reduced the market’s year-to-date return to 52.56 per cent, with market breadth closing negative as 40 stocks recorded losses against 13 gainers.
Among the top losers were Cadbury Nigeria Plc, Africa Prudential Plc and Triple Gee and Company Plc, which each declined by 10 per cent to close at N62.10, N11.70 and N3.60 per share respectively.
Also recording significant losses were John Holt Plc, which dropped by 9.93 per cent to N12.25, and McNichols Plc, which shed 9.33 per cent to close at N6.80 per share.
On the gainers’ chart, Legend Internet Plc led with a 9.52 per cent appreciation to N5.75 per share. It was followed by NPF Microfinance Bank Plc, which gained 9.18 per cent to close at N5.35, while Transnational Corporation Plc (Transcorp) advanced by 7.32 per cent to N44 per share.
Other gainers included Neimeth International Pharmaceuticals Plc, which rose by 7.03 per cent, and DAAR Communications Plc, which added 5.29 per cent.
Despite the market decline, trading activity improved as investors exchanged 691.64 million shares worth N116.85 billion in 50,025 deals, representing a 4.33 per cent increase in volume.
First HoldCo Plc emerged as the most traded stock by volume with 115.84 million shares, accounting for 16.75 per cent of total transactions, while Dangote Cement Plc dominated the value chart with trades worth N83.39 billion, representing 71.37 per cent of total market turnover.
Commenting on the market performance, Chief Executive Officer of Wyoming Capital and Partners, Tajudeen Olayinka, attributed the recent bearish trend to investors’ adjustment to the T+1 settlement cycle introduced by the Nigerian Exchange Limited (NGX).
According to Olayinka, many institutional investors accustomed to the former T+2 settlement regime are still adapting to the shortened settlement timeline, which now requires transactions to be completed one business day after trade execution.
He explained that under the previous arrangement, investors had an extra day to arrange funds and complete settlements, whereas the T+1 framework requires prefunding of transactions, making some traditional investors more cautious.
“Most traditional investors do not like to leave money with brokers before trades are executed. They prefer to pay after the transaction has been completed. Now, they have to send funds ahead of the transaction, and that is creating temporary challenges,” he said.
Olayinka dismissed suggestions that investors were selling equities to raise funds for upcoming public offers, insisting that the current weakness was driven more by reduced buying interest than profit-taking.
He expressed confidence that the market would eventually stabilise as investors become familiar with the new settlement structure.
“This is not a major setback for the market. It is merely a temporary adjustment. Over time, investors will find ways to manage the settlement process and the market will stabilise,” he added.
