Assessment of the first quarter of 2019 equity market shows prevalence of bearish movement with money market continuous edging out of equities for the first quarter of trading session. As observed, the earnings season in corporate Nigeria has not been strong enough to reverse the market from bearish move. From the index and volume of trades, it can be seen that the investing communities have shifted focus into the fixed income market as yield from money market instruments excite both local and foreign investors. Examples can be seen in Treasury Bills, FGN Bonds and other instruments which have encouraged an “exodus” experience from stock market. The statistics show movement of investors from equity segment of the financial market to the fixed income market as many investors have adjusted their portfolio as they have repositioned strongly in fixed income instrument as bearish trend in the equity market persists.
The equities market opened on a bearish note in week 13, losing by 0.53%. While the downbeat assessment of the country by the IMF loomed large on market sentiment, the World Bank also cut its growth forecast to seal the fate of the bulls. The market however showed signs of resilience, just not enough to prevent the All Share index from closing in negative territory. All the sector indices also closed lower, apart from the NSEOILG5 index, which gained 0.34% for the week.
The alteration that is currently undergoing in the financial market is on the back of uncertainty in policies as well as investors perception and psychology side which is key to overall performance. The decline in the market capitalisation is due to low sentiment, failure of the earning season to support market performance and dividend adjustments.