The Nigerian Exchange (NGX) reported its first positive trading day since July 22, 2024, amid a global stock market meltdown that resulted in the loss of over $2 trillion in market capitalization.
The All-Share Index closed at 97,745.73, and the NGX gained 0.42% to end the week. Equities gained N219 billion, and the market capitalization concluded at N55.497 trillion, up from N55.278 trillion the day before.
The world’s stock markets crashed on Friday, August 2, 2024, as a result of a sell-off sparked by worries of a US recession. The New York Stock Exchange experienced a decrease of 1.79%, whereas the S&P 500 Index saw a decline of 1.84%.
The London Stock Exchange ended the day with a 1.55% fall, while NASDAQ saw a staggering 2.43% decline. The situation was similar in Asia, where the Shanghai Composite Index closed down 0.92% and the Hang Seng Index, which follows the Hong Kong Stock Exchange, fell by 2.08%.
Based on trading data as of Friday, August 2, this worldwide stock market drop is the greatest since word of a pandemic broke in 2020.
Among the worst-hit were IT stocks, with Amazon (AMZN) down 8.78%, Microsoft (MSFT) down 2.07%, Alphabet (Google) down 2.35%, and Meta down 1.93%. Nvidia saw a decrease of 1.78% and Tesla saw a fall of 4.24%.
Reasons behind the worldwide sell-off in stocks
The US job statistics, which revealed a dramatic increase in the nation’s unemployment rate in July, sparked the selloffs.
The nation’s 4.3% unemployment rate in July, according to job data, was the highest since September 2021, raising concerns about the US economy’s decline and potential recession.
The US Federal Reserve Bank is expected to lower interest rates in September in an effort to boost demand and spending in the US economy, according to the statistics.
A few analysts have also linked the state of affairs to activities taken by the US Central Bank, emphasizing that the rate increases from 2022 to 2023 put pressure on hiring capacity at companies, leading to a gradual rise in the number of people getting unemployment benefits.
NGX rises on the second day of #EndBadGovernance protest
Both the second day of the protests in Nigeria and the shocks that shook the world’s stock markets did not affect the NGX. Only 210.9 million shares changed hands throughout the day on the NGX, the fewest since February, indicating a decrease in trading activity.
The entire amount of transactions that occurred on the NGX was around N3.95 billion, or almost $2.6 million. The market’s breadth was more favorable during the day, with 36 equities reporting gains compared to 10 that reported losses.
Leading gainers: Okomu Oil had a 10% increase and reached N321.20, its all-time high share price. Along with May & Baker, Oando maintained its bullish streak, closing at N25.30 after gaining 10%.
As oil and gas equities continue their bullish run, TotalEnergies also achieved a new all-time high share price of N427.70 with a 9.98% increase. United Capital also kept up its hot streak, closing at N12.15 after gaining 9.95%.
Leading losers: With a 9.82% loss, Mecure Industries was the worst loser of the day. The company’s half-year profits statement indicated a small dip from the previous year.
Along with Sovereign Trust Insurance, ABC Transport had a 9.09% decrease as selling pressure on that stock increased. The loss for Sunu Assurances Nigeria was 8.16%, while UPDC Plc saw a 6.92% decrease.
As the two banking SWOOTs, Zenith Bank and GTCO, reported gains of 2.86% and 2.27% to close at N36.00 and N45.00, respectively, there was an overall bullish feeling on banking equities.
Other tier-1 banking stocks also saw gains, with UBA and Access Holdings up 1.26% and 1.36%, respectively. No pricing changes were noted by FBNH during the day.
