INVESTORS’ cautious purchase of shares  reigned for five trading days on the Nigerian stock market last week, even as companies quoted in the market continued to report  plausible depreciation in their half and full year results.

The resolve by both institutional and local investors to approach the market with all sense of caution in making investment decision for now is not farfetched, as most of them lost resources during the period of the global financial economic recession, which is yet to untangle itself from emerging economies.

In the wave of the economic crisis  in 2008, the Nigeria equities market was globally adjudged to have suffered most in terms of price depreciation in the value of shares by  70 per cent.

The decision of investors to approach the securities market softly is coming in the wake of the newly Asset Management Company of Nigeria (AMCON) Bill, accented to by President Goodluck Jonathan, and this is gradually making transactions to move away from a seller market to a buyer one.

From  the first day, Tuesday 20 July, when it was reported that the AMCON bill had been signed into law, volume of transactions has been on the rise.

Experts and market watchers had, penultimate week, predicted that the signing into law of the AMCON bill, if well implemented, would bounce back the stock market, which has become an anathema  to most investors due to consistent drop in transaction volume and market value indicators.

The AMCON was introduced by the Central Bank of Nigeria (CBN)  to take over N2.2 trillion bad debt incurred by banks in the country. Significant proportion of these  debts were incurred in form of margin facilities to stockbrokers, oil and gas business as well as   insider abuse loans by some directors of  banks.

The brokers, who claimed that most of their suggestions or contributions at the formative stage of the bill were jettisoned, said the AMC bill might have little or no impact on the market if the funds to run the scheme would be contributed by  banks. It will be recalled that the 24 banks in the country and other institutions are expected to contribute N1.5 trillion to the scheme.

Also last week in the market, dealing members on the Exchange said that the Securities and Exchange Commission (SEC) must have a rethink on another round of calls for recapitalisation of stockbroking firms. They argued that this is not the best  time in the equities market. The directive, if implemented, will see  broking firms being structured along small and big business portfolios.

The total transaction for the week showed that Cadbury Nigeria Plc, UAC Plc, PZ Cusson Plc, Ashakacement Plc and Dangote Flourmills Plc led 41 companies to top the gainers’ chart with +12.06, +7.29, +6.56, +11.63 and +5.23 per cent increase while Mobil Nigeria, Conoil Plc, Larfage Wapco Cement, Okomu Oil Palm and Chemical and Allied Product led other 38 companies to pitch their tent on the losers chart with -4.99, -4.3, -4.65, -9.65 and -3.61 per cent depreciation.

Turnover of two billion shares worth N14.1 billion in 30,906 deals was recorded last week, in contrast to a total of 1.51 billion, shares valued at N9.82 billion which were exchanged in previous week in 29,134 deals. This included a total of 3,000 units of Lagos State Fixed Rate Redeemable Bond worth N3.63 million .

The market opened on Monday on a worrisome note for investors as the market capitalisation dropped 0.3 per cent or N19 billion while the index fell by the same margin of 0.32 per cent or 80.5 points.

Thirty-five stocks depreciated while 25 stocks appreciated. Flourmill Nigeria Plc depreciated by 1.3 per cent. Zenith Bank Plc and Nigerian Aviation Handling Company both dropped by 4.0 per cent and Nigeria Bottling Company and First City Monument Bank Plc lost 1.0 and 4.4 per cent respectively.

Nigerian Breweries Plc and Guaranty Trust Bank appreciated by 0.6 and 2.1 per cent each while Ashakacement, UACN Plc and Dangote Sugar Refinery rose by 1.8, 0.6 and 1.1 per cent each.

Transaction on Tuesday was on the upbeat as investors’ wealth in the market rose marginally by N4 billion or 0.07 per cent while the index climbed by 0.07 per cent or 18.71 points. The non-disparity in the twin market indicators  on Monday and Tuesday showed that there was no introduction or listing of new shares.

Thirty-four stocks appreciated compared to 19 stocks that depreciated.  PZ Cusson Plc, Cadbury Nigeria, Nigerian Breweries Plc, Ashakacement and UACN Plc all appreciated by 4.98, 4.6, 1.7, 4.9 and 1.4 per cent while Conoil Nigeria, Guaranty Trust Bank, First City Monument Bank, Berger Paints and Ecobank TransNational Incorporated (ETI) fell by a value of 4.8, 4.2, 4.7, 4.9 and 2.1 per cent respectively.

The market was up again on Wednesday as the market capitalisation increased again by N44 billion while the index chalked 179.14 basis points.

Turnover also recorded significant increase as 347.4 million shares worth N2.2 billion changed hands in 6,596 deals, higher than 268.4 million units valued at N2.3 billion exchanged in 6,914 deals on Tuesday.

Particularly, at the close of transactions, 34 stocks witnessed price appreciation compared to 19 that constituted the losers’ chart.

The development impacted 0.7 per cent increase on the performance indicators with the market capitalisation rising by N44 billion from N6.061 trillion to N6.105 trillion, while the All-Share Index inched up by 179.14 basis points to close at 24,963.99 points from the previous 24,784.85 points.

Chemical and Allied Products Plc topped the gainers’ chart with N1.50k increase to close at N33.00 per share, followed by Cadbury Nigeria Plc with N1.35k gain to close at N28.35.

On the other hand, Nigeria Bottling Company led on the losers’ table, dropping by N1.40k to close at N31.00 per share.

The banking sub-sector dominated in terms of volume with 239.2 million shares worth N1.2 billion in 3,473 deals.

The conglomerates sub-sector followed with 24.9 million units valued at N144.6 million in 254 deals, while the insurance sub-sector ranked third with 19.2 million units worth N18.8 million exchanged in 263 deals.

Transactions on Thursday showed that the All-Share Index which measures the performance of quoted companies on the Nigerian Stock Exchange rose to 25,056.07 basis point, from 24,963.99 recorded at the end of transactions on Wednesday - an increase of 0.36 per cent.

The development was occasioned by heavy transactions in the shares of some banks, especially Diamond bank and Finbank Plc.

Similarly, volume of shares traded jerked up significantly, as 495.7 million shares, worth N3.5 billion were traded in 6,266 deals, higher than 347.9 million units, valued at N2.2 billion exchanged in 6,596 deals on Wednesday.

Consequently, market capitalisation increased by N22 billion or 0.35 per cent from N6.105 trillion while All-Share Index appreciated by 92.08 or 0.36 per cent from 24,963.99 to 25,056.07.

On the price movement chart, 34 stocks appreciated in price led by PZ Cusson Nigeria Plc with 160 kobo, Cadbury Nigeria Plc followed, adding 141 kobo. UACN Plc, First Bank Plc and Unilever Nigeria Plc added 109 kobo, 57 kobo and 34 kobo per share.

However, Mobil Nigeria Plc topped the day’s losers’ table worth 873 kobo. Equity market at the close of trading session Friday, 23 July 2010 sustained its uptrend as positive outlook which resumed on Tuesday entered three trading days in a row.  Market capitalisation  appreciated by N70.563 billion   for three days.

In the same vein, the NSE All-Share Index which is used to gauge market performance recorded aggregate growth of +1.17 per cent to close at 25,056.07, after appreciating by +0.37 per cent at the close of trading session.

The upbeat recorded in the market  increased mainly by transactions in the banking and conglomerate sectors, as other NSE sectoral indexes recorded depreciation of different magnitude.

Decline in these sectors could be as a result of profit-taking by  investors from the previous rallies. This further confirms experts’ advice that as market continues to post different growth rates, there would be in between sell pressures as investors take profit.