More than $20 billion local investments in the oil and gas sector are under threat as a result of low oil prices.Following the situation, the relevant House of Representatives committee is planning to extend the implementation of the Nigerian content policy to the country’s manufacturing, telecommunication, aviation and construction sectors.
The Guardian gathered that before the fall in price of crude oil (when it was about $110 per barrel), indigenous firms purchased over $10 billion worth of divested assets from International Oil Companies (IOCs), largely financed by bank loans.The financial projections underpinning the loans have long been invalidated, and many indigenous companies struggle to service their debts. Consequently, oil revenues and profits have contracted sharply and companies, particularly in the upstream sector, battle to stay afloat.
Data from the Nigerian Content Development and Monitory Board (NCDMB) revealed that the average spend in the country’s oil and gas sector after the passage of the local content policy was more than $20 billion.
The Egina Deep Water project is said to have attracted over $1 billion into the country’s industry to create capacity and execute Nigerian content scopes provided on the deep-water project. It was gathered that business activities of indigenous companies that have invested billions of dollars have been low due to the declining crude oil prices. The Lagos Deep Offshore Logistics (LADOL), for instance, invested over $600 million in transforming the swampland of Apapa port axis in Lagos into a one-stop base for deep offshore logistics. The company even plans to attract another $5 billion investments through the LADOL Industrial Free Zone located in Lagos within the next few years.
Speaking to The Guardian on the impact of crude oil prices on operations, an industry player, Alhaji Ibrahim Sambo, disclosed that some companies had to embark on redundancies.
Sambo specifically said there had been low activities at his boat-building factory in Warri Base which commenced operation in 1986 and had built over 500 boats of various models of personnel carriers Q-860, Q-2700, Q-3300, Q-4000 and landing crafts.
According to him, the IOCs, which patronise the base that operates and maintains the boats with the facility of a maintenance workshop, have been complaining about low prices of oil.
Sambo listed other challenges to include importation of boats by some companies and paucity of funds. “We are praying that the sector will pick up very soon,” he said. Chairman of the House of Representatives Committee on Local Content, Emmanuel Okon, during a recent visit to Warri, said that the Federal Government would continue to provide condusive environment for indigenous oil companies to succeed in the face of the current low oil prices.
He expressed the House committee’s commitment to prevailing on the IOCs to patronise indigenous oil and gas firms. “We will make sure that there is a legislative policies to encourage local companies. The local content is to help companies like West Africa Ventures”, he added.
Ekon appealed to local investors to invest heavily in the economy of Nigeria, saying the development is the only measure to spur the growth of the country.The House of Representatives member explained that local content in its entirety should be beneficial to all Nigerians if implemented appropriately. “Local content has the capacity to turn around the fortunes of Nigeria for good. It has the capacity of transforming our economy to any level that we want to, but again the implementation lies with us all. We must realise that Nigeria is our country. We do not have any other country to call our own”, he said.
Meanwhile, the Spanish Ambassador to Nigeria, Alfonso Barnuevo Sebastian de Erice, has said that Spain buys €4.6 billion worth of crude oil from Nigeria annually. The envoy who disclosed this at the official commissioning of the Spanish LaLiga Nigeria office at the weekend in Abuja said Spain was the third best client of Nigeria.
“I am very happy that the already fruition relation between Nigeria and Spain is expanding to other domains. Nigeria is a strategic partner of Spain in energy matters,” he said. The Spanish envoy noted that as the first economy in Africa in terms of GDP, Nigeria has enormous potentials.He said that the commissioning of the LaLiga office in Nigeria marked the beginning of a solid presence in Nigeria.“As a Spanish ambassador, I have to express my satisfaction that one of the strongest institutions in Spain, and probably one of the best in the world known worldwide, LaLiga has established an office in Nigeria.”
Speaking at the commissioning of the office, LaLiga President, Javier Tebas, said the commissioning was a proof that League was ready to help the country in making Nigerian League one of the best in the world.“The Spanish League is convinced that together with the Nigerian League, we would be very strong.”
Expectations are high about the steps that the Central Bank of Nigeria’s Monetary Policy Committee will take at its meeting, which holds today and tomorrow, following the declaration by the Finance minister that the economy is now in recession amid rising inflation and massive job losses,
Financial analysts have called on the Monetary Policy Committee of the Central Bank of Nigeria not to increase the Monetary Policy Rate, which currently stands at 12 per cent, ahead of the committee’s meeting scheduled for today (Monday) and Tuesday.
The Monetary Policy Rate is the anchor rate at which the CBN, in performing its role as a lender of last resort, lends to Deposit Money Banks to boost the level of liquidity in the banking system.
If the apex bank intends to increase the level of liquidity in the economy, it reduces the MPR, but increases it when it intends to tighten money supply.
The President, Institute of Fiscal Studies of Nigeria, Mr. Godwin Ighedosa, said that since the economy was struggling with high inflation rate and unemployment, raising the interest rate now would not achieve the desired result.
He said the level of inflation in the country was caused by factors outside the control of the monetary policy, noting that rather than tightening the level of liquidity in the economy, the CBN should either hold the rate at 12 per cent or reduce it to stimulate productive activities.
Ighedosa stated, “There is a general tendency to want to raise interest when there is a general rise in price level as the fundamental job of the central bank is price stability.
“The stabilisation of prices is vital for investment decisions, but again, monetary policy is a short to medium-term measure, and so one of the problems in Nigeria is the disconnect between the monetary policy, industrial policy and fiscal policy issues.
“Now, there is temptation to raise interest rate when you have inflation, but the problem now is that we have inflation with unemployment rising at the same time; and so, the idea of wanting to raise interest rate with the hope of reducing the price level will not necessarily deal with the problem.
“And so, if you want to stimulate the economy, then the rate should be left unchanged, because what is evident in our economic situation now is that the inflationary pressure is import-induced and whatever traditional policy measures you want to use now by raising the interest rate will not solve the problem.”
He added that the best policy response that could be adopted by the monetary and fiscal authorities was to begin to build productive capacity and also invest in areas where the country had domestic capacity in terms of demand.
“This is the wrong time to move the interest rate up; rather, we should invest massively in terms of building industrial capacity locally and then try to consume locally the things that we produce,” he noted.
Head, Department of Banking and Finance, Nasarawa State University, Keffi, Uche Uwaleke, said the fact that inflationary pressure had remained in spite of the CBN’s efforts to control money supply underscored the fact that in reality, dealing with double-digit inflation was more complex, particularly in a period of declining output and unemployment.
He said, “What is needed now is a combination of monetary and fiscal measures aimed at removing supply side constraints.
“The CBN left its benchmark rate unchanged at 12 per cent in May and is expected to announce its next decision after its meeting later in July. Without prejudice to the outcome of that meeting, the MPC will be well advised not to jerk up the MPR in a bid to subdue the inflationary pressure as doing so will further hurt output and employment.
“Rather, the committee should consider easing the monetary policy with a view to stimulating economic growth and reducing unemployment.”
The economy has been badly hit by rising inflation, which peaked at 16.5 per cent in June, the highest in 11 years, in addition to forecast by the International Monetary Fund that the nation is heading into a recession.
The Minister of Finance, Mrs. Kemi Adeosun, had while appearing before the Senate on Thursday, said the current indices had shown that the country was technically in a recession.
She had said, “Technically, in economic terms, if you have two periods of negative growth, you are in a recession. I don’t think we should spend too much time on this. The issue is we are in a tough place, whether we call it recession or not, we are in a tough place.
“But most importantly, we are going to get out of it. What we are doing is moving us out of it.”
A recession is defined as a significant decline in activities across the economy, lasting longer than a few months. It is visible in industrial production, employment, real income and wholesale retail trade.
The technical indicator of a recession is two consecutive quarters of negative economic growth as measured by a country’s Gross Domestic Product.
Nigeria’s GDP growth contracted to -0.36 per cent in the first quarter of this year compared to 2.11 per cent in the fourth quarter of 2015.
The National Bureau of Statistics is due to release the GDP figure for the second quarter any time from now.
Financial analysts said without adequate coordination of monetary and fiscal policies, it would be difficult for the government to stimulate the economy.
A former Acting Managing Director, Unity Bank Plc, Mr. Muhammed Rislanudeen, said that while the Nigerian economy had been badly hit by rising inflation and weak growth, the government could have reduced the negative impact if it had an effective economic management team made up of representatives of both the public and private sectors.
He said, “The economy is challenged from two fronts, inflation and weak growth. Now, for inflation, which is at 16.5 per cent, the challenge for the MPC is to either allow it to go up unchallenged or raise interest rate above the rate of inflation.
“But from what is on the ground, I will suggest that the CBN should still hold the rates and then challenge the government to address the structural challenges causing inflationary pressures.”
Asked what could be done by the government to reposition the economy on the path of growth, Rislanudeen said, “In terms of the slow economic growth, there is a need for synchronisation between the monetary and fiscal policies.
“Currently, there is no synchronisation of policies and that is why the economy is facing challenges. So, this is the time for both the CBN and the Ministry of Finance to work together to fashion out policies that will help to address the challenges facing the economy.”
A former Managing Director, Nigeria Deposit Insurance Corporation, Mr. Ganiyu Ogunleye, said the country had so much depended on revenue from oil, which had made the economy to become volatile and unable to withstand external shocks.
He explained that there were no quick fixes to the structural challenges facing the economy, noting that even if the country was to have all the money in the world, there was no way it could build projects such as roads, power plants and refineries before the end of the year.
These, according to him, are needed to stimulate economic activities and attract the much needed investments to create jobs and reduce the level of poverty.
Ogunleye stated, “The country’s over-dependence on oil revenue has been a problem to the economy, and if the government is to bridge this kind of gap, it will take some time.
“There are no quick fixes to the economic challenges. The government needs to clearly indicate its policy direction. There is no quick fix and as such, all of us have to adjust our expectations and consumption pattern.
“The inconsistent policies of government is one of the reasons why investors are not coming and this has to be addressed, because it appears that we are doing some kind of experimentation with our foreign exchange. We have been trying various approaches at managing the foreign exchange and I am not sure we are there yet.”
He added, “We started with capital control; now, we have gone to a liberalised system and for the liberalised system to even work efficiently, there is an underlying assumption that the supply will be adequate and investors are still having problems finding foreign exchange.
“The government can look at privatising some of our major entities if that will increase the level of foreign investors in the economy.”
On his part, the Executive Director, Corporate Finance, BGL Capital Limited, Mr. Femi Ademola, called on the Federal Government to scale up spending on critical infrastructure projects, noting that the time for talk shows was over.
He said, “This is not time for talk shows. The government should start implementing its programmes if it has any. They should let people go back to work. It’s not bad to fight corruption, but it appears that this government is spending a lot of its time fighting corruption and seems to be neglecting the economy.
“Inflation has risen to 16.5 per cent and it is high not because of excess liquidity, but because of structural issues that have made it difficult for people to produce.
“There is no money in the economy to produce and those that could produce did so with a lot of difficulties. Things have become so expensive now and this is the time for this government to start massive implementation of its programmes.”
Corporation’s boss urges review of existing regulations The Nigeria Deposit Insurance Corporation (NDIC) has condemned the rising rate of non-performing insider loans in various banks. It said this situation, if not checked could have negative consequences on the financial system.
Managing Director/Chief Executive of Alhaji Umaru Ibrahim expressed this concern while receiving the newly elected President & Chairman of Council of the Chartered Institute of Bankers of Nigeria (CIBN), Professor Segun Ajibola and his executive members who paid a courtesy call on the NDIC Senior Management in Abuja.
According to Ibrahim, the development poses credibility questions, capable of eroding public confidence in the banking system.He therefore called for strict compliance with the existing code of conduct and a review of the existing laws and regulations to provide stiffer penalties for directors who take advantage of their positions and failed to pay back their loans.
The NDIC CEO also observed with concern the practice of some banks to assign sensitive roles to casual staff; thereby exposing the banking industry to cases of fraud and forgeries. Advising restraint, Alhaji Ibrahim urged banks to exercise caution so as not to create industrial unrest in the industry, he therefore called on the CIBN to intervene by advising its members on the aim of the rationalisation which should be to weed out bad eggs from the industry.
The NDIC boss emphasized that the corporation would continue to partner with the CIBN and other professional bodies towards achieving effective capacity building among its staff.
Prof. Ajibola expressed appreciation to the Corporation for positive contributions to the activities and programmes of the Institute and also pledged to table the matter at CIBN’s next meeting with banks’ CEOs with a view to addressing the issues.He stated that efforts were being put in place by the CIBN to enhance the capacity of bank staff, particularly in credit administration.
Investors staked a total of N48.72 trillion on fixed income securities and currencies on the FMDQ OTC Securities Exchange between January and June 2016.
According to statistics obtained by the THISDAY, N22.5trillion was invested in the first quarter of 2016, N9.43trillion in April, N7.43trillion in May and N9.36trillion in June, amounting to N48.72trillion in six months.
A breakdown of the performance in June showed that activities in the Treasury bills (T.bills) market remained dominant, accounting for 38.14 per cent of total turnover while Secured Money Market (Repurchase Agreements (Repos)/Buy-Backs) came second place, accounting for 26.5 per cent.
Total Foreign Exchange (FX) market transactions accounted for 26.07 per cent, while Federal Government of Nigeria FGN bonds and Unsecured Placements/Takings accounted for 4.85 per cent and 4.34 per cent of the total turnover respectively.
FMDQ explained that milestones were recorded in the FX market as the Central Bank of Nigeria (CBN) took steps to restructure the market.
“The apex bank released revised guidelines for the FX market, effectively liberalising the market, and appointed Foreign Exchange Primary Dealers (FXPDs). Furthermore, in a very bold and decisive move, the CBN cleared the backlog of transactions in the market via a one-time Special Secondary Market Intervention Sales (SMIS) auction. Accumulated backlog totalling $4.02 billion, was cleared with $0.53 billion (13.24 per cent) settled spot and the remaining 86.76 per cent ($3.49bn) spread over one to three months forward contracts,” it said.
The exchange added that on June 27, Naira-settled OTC FX Futures product was also introduced into the Nigerian FX market with the CBN as the pioneer seller. “The CBN offered twelve (12) consecutive monthly contracts with initial notional amounts of $1.00bn each. OTC FX Futures Contracts totalling $38.80 million were executed by the end of the month,” the exchange said.
Based on the reform in the market by the CBN, transactions in the FX market settled at $7.51 billion in June, an increase of 83.82 per cent compared with the value recorded in May.
Turnover in the fixed income market settled at N4.02trillion, showing increase of 2.05 per cent above the previous month’s value, with transactions in the T.bills market accounting for 88.71 per cent of the turnover.
Outstanding T.bills closed the month at N5.28 trillion whilst outstanding FGN bonds increased 1.73 per cent to close at N6.57 trillion. Trading intensity in the Fixed Income market settled at 1.24 and 0.07 for T.bills and FGN bonds respectively, with maturities between one month to three months being the most actively traded in June.
Renaissance Capital and CSL Stockbrokers have both placed a “BUY” rating on United Bank for Africa (UBA) Plc, saying it is capable of generating returns of more than 100 per cent in the next 12-month period.
The “buy” rating on UBA, underlines its attractiveness despite the general downward trend at the stock market.Renaissance Capital, in its recommendation forecasted that the bank’s stocks would remain bullish, adding that its share price could rise to N9.40 per share. CSL Stockbrokers, a member of FCMB Group, also expressed optimism that UBA could trade at N7.21 per share in the next 12 months.
On the average, analysts’ consensus target price is N8.50 per share for UBA for the 2016 business year. The strong investment case for UBA, according to a statement by the bank, followed the recent affirmation of its credit rating by Fitch as well as an upgrade by Agusto & Co.
Fitch International, one of the foremost global rating agencies affirmed the bank’s viability rating at “B” an affirmation of its strong risk management framework, which has helped keep non-performing loans ratio at a moderate level of 1.74per cent as at the end-March 2016, as against industry average of over 6 per cent, as reported by Fitch in its recent report on Nigerian banks. Fitch also upgraded UBA’s outlook to stable from Negative, thus reinforcing the strong outlook on the Bank, especially as its diversified network across eighteen other African countries make it relatively immune against the potential cyclical volatilities in any of its country of operations.
Also, the foremost local rating agency in Nigeria, Agusto & Co, at its rating review of UBA Plc, upgraded the Bank’s rating from “A+” to “Aa-“, with a stable outlook.
According to Agusto & Co, “the rating of United Bank for Africa Plc (UBA) is upheld by the Bank’s improved capitalization, good liquidity and large pool of stable deposits, strong domestic presence supported by the Bank’s extensive branch network and growing alternative banking channels.
“We note improvement in profitability and the Bank’s good asset quality. The Rating takes into cognizance the weak macroeconomic climate on the banking industry’s asset quality, which we do not expect UBA to be excluded.
“Nonetheless, we note positively its diversified geographical reach, which will cushion to an extent the impact of the weak Nigerian economic climate,” Agusto & Co stated in its credit rating report.”The bank also sealed a five- year deal Master Card that would enable it issue MasterCard credit, debit and prepaid cards across 19 markets in Africa.
The synergy would also focus on increased payments infrastructure across Africa, including the roll out of point-of-sale and Mobil technology, to ensure merchants accept the cards when introduced into these markets.
The Group Managing Director-Designate, of the bank, Kennedy Uzoka explained that through the partnership, the bank was able to accelerate the drive for financial inclusion and economic wellbeing across the African continent.
“As the needs of our customers change, we are adapting through strategic innovations and partnerships to provide them with excellent and convenient services.”
The Division President for Sub-Saharan Africa, MasterCard, Daniel Monehin noted that the focus on infrastructure and the roll out of easy-to-access solutions was a key driving force for financial inclusion.
He added that MasterCard’s continued innovation in the payments space with UBA’s extensive pan-African network would mean the introduction of increased competition and stronger financial sector in the regions.
The Central Bank of Nigeria (CBN), has affirmed its confidence in Skye Bank Plc., through a guarantee line which ensures that withdrawals it suffered in the wake of undue panic recently does not adversely affect its operations.
This development analysts believe lends credence to the regulator’s earlier assertion that Skye Bank is a Strategically Important Bank (SIB), with substantial market share, interconnectedness and significant relevance to the nation’s financial systems stability.
Bloomberg, reported that the central bank confirmed this development through its spokesman, Isaac Okoroafor, who stated that the undisclosed guarantee sum would assist the bank to shore up its liquidity and maintain its level of operations.
“The short-term lending facility will allow the management of the bank to ensure that some withdrawals it suffered in the wake of the undue panic of last week do not adversely affect its operations,” Okoroafor was quoted to have said.
In addition, “the CBN issued guarantees to depositors and creditors of Skye Bank as a demonstration of the bank’s health”, Okoroafor further explained.
The guarantee line is coming on the heels of CBN’s recent intervention in the bank following the voluntary resignation of the Board of Directors of the bank and the consequent re-constitution of the Board with a new management team led by Mr. M.K. Ahmad and Mr. Adetokunbo Abiru, who emerged as Chairman and Group Managing Director respectively.
The CBN guarantee will not only enhance Skye Bank’s interbank trading and activities; but will also provide assurance to the other banks to continue to deal with and trade with the bank’s instruments in the interbank market.
The CBN had similarly introduced a bank credit guarantee package for some banks in 2009 in the wake of the global economic crisis which affected both the local and global financial markets. The bank guarantee programme enables financial institutions to meet their financing needs during a period of record high credit spreads and aids the successful return of the credit market to near normalcy, despite the recession and slow economic recovery.
The affirmation of confidence in Skye bank continues to grow as no fewer than two state governments have expressed confidence in the bank’s ability to deliver on crucial mandates in the last two weeks. First, it was the Lagos State government, which directed its ministries, departments and agencies to establish business relationship with the bank on account of its track record and pedigree in mandate execution.
For the first time in the 2016 fiscal year, the monthly allocation from the Federation Account crossed the N500bn threshold with the Federation Accounts Allocation Committee distributing a total sum of N559.03bn to the three tiers of government on Thursday.
This is even as the gross revenue accruing to the federation increased by N301.32bn, the highest in a long time.
Addressing journalists shortly after the FAAC meeting, which was held at the headquarters of the Ministry of Finance in Abuja, the Minister of Finance, Mrs. Kemi Adeosun, attributed the increase in revenue to efficiency in collection by the revenue generating agencies.
Specifically, she said there was an increase in non-oil tax collection by the Federal Inland Revenue Service, as the agency recorded an increase of N165bn in tax collections, while the Nigeria Customs Service raised its revenue by N12.6bn
Adeosun said, “The big cause of the increase is the improvement of non-oil revenue from the FIRS. The FIRS improved its performance between last month and this month by N165bn. And that accounted for the change in revenue; and also, there was an improvement of N12.6bn by the Nigeria Customs Service, as well as the exchange rate gain of N79.2bn
“This is a significant improved performance, especially by the Customs that was able to do so despite the scarcity of foreign exchange and the restrictions on the 41 items. So, we are quite encouraged by that because it means that some of the reforms that we have started around collection improvement are beginning to bear fruit.”
This increase in revenue, according to her, led to an improvement in the amount allocated to the three tiers of government from N305.12bn in May to N559.03bn for the month of June.
Giving a breakdown of the amount shared, the minister said N412.3bn was distributed under statutory allocation; N67.4bn under Value Added Tax revenue; while the balance of N79.27bn was allocated from the gain made from exchange rate differentials.
Out of the N412.3bn shared under statutory allocation, Adeosun said that after deducting the costs of collection to the Customs and the FIRS, the Federal Government received N199.75bn; the states, N101.3bn; local governments, N78.11bn; while the sum of N17.12bn was shared to oil producing states based on the derivation principle.
For VAT, she said the Federal Government received N9.7bn; states, N32.35bn; and local governments, N22.67bn.
The minister said, “The gross statutory revenue of N538.78bn received was higher than the N237.46bn received in the previous month by N301.32bn. The average price of crude oil increases from $32.26 in February to $38.64 in March, resulting in $92.99m increase in federation export revenue.”
The naira weakened against the dollar from 294.37 at the interbank market on Wednesday to 310.43 on Thursday, crossing the 300 mark for the first time at the interbank market after the Central Bank of Nigeria floated the naira.
The naira fell by 5.4 per cent against the greenback to 309 at 1224 GMT on dollar supply shortages, Reuters reported.
It later recovered to close at 292.40 on the interbank market on thin trades. The interbank market traded a total of $7.27m.
Traders were expecting the central bank to intervene to ease dollar shortages, which did not materialise.
They said the CBN had not intervened for most of this week. Instead it was mopping up naira liquidity to support the currency.
After market closed at 1300 GMT, a total of $7.10m trades were done as low as 330.50 naira to the dollar.
“Now that the market has adjusted upwards it seems people are comfortable and that’s why we are seeing some trades,” one trader said.
Banks had been quoting the dollar at 281 to 285 naira after the central bank lifted its 16-month-old peg of N197 to the dollar last month.
According to traders, the lack of liquidity at those levels has curbed activity, leaving the central bank as the main supplier of dollars.
The naira traded flat on the black market to 375 against the dollar on Thursday.
Oando Plc, Diamond Bank Plc and Transnational Corporation of Nigeria Plc on Thursday emerged as the top three losers at the close of trading on the floor of the Nigerian Stock Exchange (NSE).
The market posted a loss of N77bn, with a total of 34 losers.
The NSE market capitalisation slid to N9.615tn from N9.692tn, while the All-Share Index closed at 27,997.29 basis points from 28,221.18 basis points.
On the aggregate, 227.134 million shares worth N1.801bn were transacted in 3,426 deals.
The highest index point attained in the course of trading was 28,806.45 basis points, while the lowest and average index points were 27,997.29 and 28,449.28 basis points, respectively.
Oando shares depreciated by N0.47 (8.92 per cent) to close at N4.92 from N5.39, while those of Diamond Bank lost N0.15 (8.62 per cent) to close at N1.59 from N1.74.
The share price of Transcorp plunged by N0.12 (8.51 per cent) to close at N1.29 from N1.41.
Honeywell Flour Mill Plc and Cadbury Nigeria Plc also recorded losses as the share price of the former closed at N1.38 from N1.50, losing N0.12 (eight per cent), while the latter recorded a loss of N0.89 (5.53 per cent) to close at N15.20 from N16.09.
Other losers include Stanbic IBTC Holdings Plc, Fidson Healthcare Plc, Learn Africa Plc, Champion Breweries Plc, Dangote Sugar Refinery Plc, Ecobank Transnational Incorporated and Academy Press Plc.
The list also include Livestock Feeds plc, NPF Microfinance Bank Plc, Unity Bank Plc, Aiico Insurance Plc, UAN Property Development Company Plc, Guaranty Trusts Bank Plc, Access Bank Plc, Johnholt Nigeria Plc, Fidelity Bank Plc, Africa Prudential Registrars Plc and FBN Holdings Plc.
United Bank of Africa Plc, UACN Plc, Nestle Nigeria Plc, Zenith Bank Nigeria Plc, Eterna Plc, Flour Mills Nigeria Plc, Guinness Nigeria Plc, FCMB Group Plc, AxaMansard Insurance Plc, Vitafoam Nigeria Plc and Lafarge Africa Plc also recorded losses of various degrees on their share prices.
Only six firm recorded appreciation in their share prices. Skye Bank Plc, Wema Bank Plc, AG Leventis Nigeria Plc, CAP Plc and Tiger Branded Consumer Goods Plc were the top five gainers.
The share price of Skye Bank soared by N0.07 (8.97 per cent) to close at N0.85 from N0.78, while that of Wema Bank closed at N0.78 from N0.73, recording a gain of N0.05 (6.85 per cent).
AG Leventis shares gained N0.04 (4.30 per cent) to close at N0.97 from N0.93, while those of CAP closed at N36 from N35, gaining N1 (2.86 per cent).
Tigerbrands shares also appreciated by N0.08 (2.08 per cent) to close at N3.93 from N3.85, while the shares of Nigerian Breweries Plc fell in value.
Commenting on the market performance, analysts at Vetiva Capital Management Limited, said the Nigerian equity market extended its negative run fuelled by sustained losses among key sectors, with the financial services sector completing a seven-session decline.
On the global scene, Asian markets were mostly up after the Bank of Japan hinted at the introduction of stimulus packages worth $188bn, exceeding expectations of about $94bn. The United States stocks rallied as investors continue to cheer a slew of upbeat earnings releases. However, European markets traded lower following the decision of the European Central Bank to keep interest rate at zero per cent.
The financial services (-256bps) and oil and gas (-92bps) sectors weighed most on the NSE ASI following significant losses in the share of Diamond Bank, Stanbic IBTC, GTB and Oando.
Industrial goods (-32bps) and consumer goods (-24bps) sectors also closed in the negative on the back of declines in WAPCO (Lafarge), Honeywell Flour Mills, Dangote Sugar and Guinness.
Skye Bank topped the volume chart, trading 54 million unit, while WAPCO topped the value chart, trading eight million units worth N479m.
The NSE ASI and NSE 30 lost 79bps and 107bps, putting year-to-date returns at -2.25 per cent and -4.02 per cent, respectively.
“We see the market completing an all week loss at week close amidst sustained bearish sentiment for bellwether stocks,” the analysts said.
Yesterday, 27 stocks depreciated in price, led by Oando, shedding 9.56 per cent to close at N5.39 per share. Law union and Rock followed with 7.27 per cent to close at N0.51 per share. Trans National Corporation shed 7.24 per cent to close at N1.41 per share. Stancbic IBTC dropped 4.83 per cent to close at N14.20 per share. Fidson lost 4.72 per cent to close at N2.02 per share. Honeywell flourmills dropped 4.46 per cent to close at N1.50 per share.
First City Monument Bank and Zenith Bank shed 4.41 and 3.97 per cent to close at N1.30 and N15.50 per share. TigerBrands shed 3.51 to close at N3.85 per share. Livestock shed 3.09 per cent to close at N0.94 per share.
On the other hand, eight stocks made the gainers table, as Skye bank emerged the highest price gainer with 8.33 per cent to close at N0.78 per share. Premier Breweries gained 4.98 per cent to close at N2.95 per share.
TransNational Express added 4.95 per cent to close at N1.06 per share. Dangote Sugar Refinery garnered 2.26 per cent to close at N6.80 per share. NPF Micro finance Bank gained 1.06 per cent to close at N0.95 per share.
Flourmills added 0.93 per cent to close at N21.70 per share. Ikeja Hotel gained 0.53 per cent to close at N1.90 percent. Nigerian Breweries also garnered 0.04 per cent to close at N135.10 per share.
