NGX Loses N5.42 Trillion in 20-Day Market Correction

The Nigerian Exchange (NGX) underwent a 20-day bearish run following a historic peak of N160.40 trillion on July 31, resulting in a loss of N5.42 trillion by August 20, bringing total equity valuation to N154.98 trillion. The NGX All-Share Index (ASI) fell by 2.14 percent, from 245,283.69 points to 240,037.80.

This market decline was largely due to profit-taking by investors, particularly impacting low-cap equities, insurance companies, and major oil and gas players. International Energy Insurance faced significant losses, frequently hitting its daily 10 percent loss limit.

The National Insurance Commission (NAICOM) revoked Universal Insurance’s license, rendering it worthless. Other companies like Fortis Global Insurance and Dangote Sugar Refinery also experienced declines.

Analysts attribute the selling pressure to rising yields in the secondary market, making fixed-income securities more appealing. Despite the downturn, analysts remain optimistic about a market rebound in the second half of the year, supported by potential re-inclusion in the FTSE Russell Frontier Market Index and sustained institutional inflows.