INVESTORS in the Nigerian equities market are currently at a crossroad, as their investments’ value have continued to deplete by the day. The belief among the ordinary investors, whose total figure is conservatively put at over seven million, is that the measures taken by the Central Bank of Nigeria (CBN) as regard the  Asset Management Company of Nigeria (AMCON), to help absorb the rescued banks’ N1.7 trillion toxic assets and recent changes at the Nigeria Stock Exchange (NSE) brought about by the Securities and Exchange Commission (SEC), appear to have no positive impact on the market.

Ordinarily, the banks, which control about 60 per cent of transactions in the market on a daily basis, have since failed to direct the positive position which the market deserves at this auspicious time where confidence is at its lowest ebb. The belief in the market currently is that AMCON might not take off this year.

Investors’ woes in the market are further compounded by shareholders themselves who have instituted suits against the apex bank's attempt to sell some of the rescued banks. This has further deepened the uncertainty over the prospect of an early recovery for the affected banks.

The present state of health of the market has further resulted in a glut of shares, as most stock broking firms now come to the floor of the Exchange with a long list of mandate to sell with only few buyers available.

Investors, who are in dire need of funds have resorted to selling their holdings far below the quoted price on the exchange. This has been described  as the only way they could have their holdings exchanged for money. A typical example is an investor who bought 200,000 units of Transnational Incorporation of Nigeria (TRANSCORP) shares for about N1.5 million at the peak of the market but had to sell them for a paltry sum of N80, 000 last Friday, so as to meet some pressing needs.

This verifiable example is a reflection of the true position of affairs in the stock market among the ordinary investors, who choose to invest in the market based on roadside information that the stock market is a place where they could make fortune overnight.

Investors in the securities market had, at the beginning of the year, took positions owing to the rock bottom prices of stocks across the sub-sectors based on the assumption that AMCON would soon become operational. This planned buying of shares, especially the banking stocks, greatly drove the performance measuring parameters of the equities market, thus making the market to rise by 24.5 per cent in the first quarter of the year.

As a result of this, analysts have predicted that  banking shares would suffer value depletion in no distant time. Also, lack of confidence in the market by investors which is yet to be properly addressed by those concerned is also impacting on the market negatively.

The NSE interim administrator, Mr. Emmanuel Ikazoboh, had linked the down swing on the Exchange within the context of developments in the international stock market, adding that the Exchange could not be insulated from global development. Explaining the global trend, Ikazoboh noted that “globally, there are fears that the downturn isn’t completely over and that we may experience a double dip in growth.”

The investing public is, however, of the opinion that the regulatory bodies in the market must act fast to check the decline in the composite index value, and save the ordinary investors of untold hardship they had been subjected to when the market stock crisis erupted two years ago.

Another activity that characterised transactions in the market last week was the engagement in massive sale of shares owing to CBN’s directive that banks’ risk asset portfolio in the stock market must not exceed 10 per cent before September 1, this year.

It would be recalled that about 70 per cent of the banks’ toxic assets totaling about N2.5 trillion was lost as a result of margin loans to stockbrokers. Some brokers who spoke to Investors Guide lamented that despite improved results from quoted companies, offloading of shares to meet up with the September deadline had further worsened the woes of investors.

Majority of the blue chip companies on the Exchange suffered price depreciation on Monday trading, as performance indicators fell by N32 billion, indicating another bleak period for investors in the week.

It would also be recalled that most of the highly valued stocks in the market had, in recent times, declared their earnings for the half year, and to discerning investors their stocks might not yield good returns at the end of their financial year. To this end, investors have been taking profits by way of overloading their holdings in the blue chip companies.

A further review of transaction in the day showed that total volume traded recorded an increase, as 249.2 million shares worth N1.6 billion changed hands in 5,680 deals, higher than 195.9 million units valued at N2.1 billion exchanged in 6,054 deals on Monday. In the day, 38 stocks recorded price depreciation compared to 27 that appreciated in price, thus causing price losers to outweigh gains.

Specifically, West African Portland Company emerged the day’s highest price loser with 55 kobo to close at N38.00 per share, while Cadbury Nigeria followed with 49 kobo to close at N28.91 per share. Guaranty Trust Bank, Dangote Flourmill and Dangote Sugar Refinery lost 47kobo, 42kobo and 32kobo to close at N16.31, N18.85 and N17.02 per share respectively.

On the other hand, Northern Nigeria Flourmills topped the gainers table with 214 kobo to close at N44.98 per share. African Petroleum (AP) followed with 105 kobo to close at N22.25 per share.

Tracking the concerns of traders and investors about the likelihood of a second global recession, the Nigerian stock market further turned bearish on Tuesday. The values of all listed equities fell through to N5.99 trillion.

The composite index of the NSE declined by 1.89 per cent at 24,503.61, as blue-chips lost grounds. All the sectorial indices ended in the red. The banking index declined by a whopping 3.2 per cent, insurance fell by 1.10 per cent, food index dip by 2.16 per cent, while oil and gas index went down by 0.62 per cent. The NSE Top 30 index was negative by 1.78 per cent.

On the trading board on Tuesday, Conoil Plc was negative by 200 kobo, Cadbury 144 kobo, Flour Mills 107 kobo, PZ Cussons 164 kobo and Benue Cement 150 kobo.

Trading activities on Wednesday continued in red, as both market performances depreciated considerably. The market capitalisation shed N96 billion or 1.62 per cent to close at N5.896 trillion, while the All-share Index equally dropped by 1.62 per cent or 392.1 basis points to close at 24,111.51.

However, investors on the trading floor of the market continued  their patronage of banks’ shares as a total of 115.4 million shares valued at N909.02 million exchanged hands in 3,837 deals.

The high volume of share traded in the sub-sector was largely driven by the activity in the shares of First Bank Plc, Access Bank Plc, Diamond Bank and Zenith Bank.

Trading on the shares of the four banks accounted for 53.3 million ordinary shares or 53.8 per cent of the sub-sector turnover.

Transactions on Thursday saw investors temporarily  heaving a sigh of relief, as major blue-chip companies recorded price gains, thus, causing investors wealth to rise by N16 billion. Trading in the day showed that 33 stocks appreciated in price compared to 24 that constituted the losers’ table. Specifically, the All-share Index rose marginally by 64.02 points or 0.2 per cent from 24,111.51 recorded the previous day to 24,175.53 while market capitalisation increased by N16 billion or 0.27 per cent from N5, 896 trillion to N5, 912 trillion.

Nigerian Bottling Company Plc emerged the day’s highest price gainer with 183 kobo to close at N38.56 per share while African Petroleum Plc followed with 122 kobo to close at N25.74 per share.

PZ Cussons led others on the losers’ chart with 100 kobo to close at N35.00 per share. Cement Company of Northern Nigeria Plc followed with 65kobo to close at N14.50 per share.

With transactions exchanged in 3,354deals, the banking sector dominated in volume terms with 163.5million shares worth N1.3million while the insurance sub-sector followed with 19.8 million units worth N17.3 million in 168 deals.

The market closed the week on Friday again on a positive note as the market capitalisation rose by N24 billion, while the index climbed 98.98 points to close the week at a high of N5,936 trillion and 24,274.51 points respectively. A review of transactions in the day showed that 41 companies pitched their tent on the gainers’ table as against 25 on the laggard’s side.

A review of the cumulative transaction in the week showed that African Petroleum Plc appreciated most. The company stock rose by N5.82. Northern Nigeria Flourmills Plc followed closely with N2.14 per share while the Guinness Nigeria, Nigerian Bottling Co. Plc and Longman Plc ended the week among the five top gainers with N2.00, N1.76 and N0.61 per share respectively. Conversely, Oando Plc, PZ Cusson Plc, Benue Cement Company Plc, Conoil Plc and Cadbury Nigeria Plc slid in value by N6.95, N4.00, N2.50, N2.00 and N1.93 per share respectively.