NGX Trading Value Surges 476% to N637.83 Billion Amid Heavy First HoldCo, GTCO, UBA Turnover

Trading value on the Nigerian Exchange (NGX) surged by approximately 476% last week to N637.83 billion following the unusually heavy turnover in First HoldCo, Guaranty Trust Holding Company (GTCO) and United Bank for Africa (UBA).

Investors traded 7.619 billion shares worth N637.826 billion in 192,138 deals during the week ended October 30, compared with 2.024 billion shares valued at N110.773 billion in 173,113 deals in the previous week.

The figures represent a 276.4% increase in trading volume and a 475.8% jump in value, while the number of deals increased by just 11%.

The disparity between the sharp increase in turnover and the relatively modest growth in transactions showed that the surge was driven largely by substantial volumes changing hands rather than a comparable increase in the number of trades.

Financial Services accounted for the bulk of activity with 6.990 billion shares worth N573.492 billion traded in 85,998 deals.

The sector alone represented 91.75% of total equity turnover volume and 89.91% of value during the week.

Activity was even more concentrated among three financial stocks.

First HoldCo, GTCO and UBA jointly recorded 6.096 billion shares worth N544.438 billion in 27,001 deals, accounting for 80.02% of all shares traded on the NGX and 85.36% of total market value.

The concentration means the sharp increase in aggregate turnover did not represent an equally broad expansion in trading activity across the market.

Daily trading figures further showed that Tuesday, October 27 was responsible for a substantial portion of the week’s exceptional turnover.

A total of 5.233 billion shares worth N441.439 billion changed hands during the session, representing about 68.7% of the week’s total volume and 69.2% of total value.

Activity moderated sharply to 404.08 million shares worth N27.90 billion on Wednesday before rising to 654.14 million shares valued at N57.25 billion on Thursday.

Friday recorded another strong session with 997.56 million shares worth N85.81 billion traded.

The heavy turnover also occurred during a volatile week for First HoldCo.

According to the NGX weekly price table, First HoldCo declined 17.31% from an opening reference price of N144.10 to N119.15, making it the fourth-biggest decliner for the week.

The decline is important in interpreting the unusually high financial-sector turnover because significant trading activity in a stock does not necessarily indicate bullish demand. First HoldCo’s price performance showed that substantial volumes changed hands while the stock was declining.

Despite the concentration of turnover and weakness in several financial stocks, the broader NGX All-Share Index advanced 2.86% from 247,222.27 to 254,299.49, while market capitalisation closed at N165.114 trillion.

The Banking Index, however, declined 3.42% during the week, highlighting the divergence between the broader market’s performance and banking stocks.

Market breadth also remained negative despite improving from the previous week. Thirty-three equities appreciated compared with 20 previously, while 48 declined compared with 55 in the preceding week. Another 65 stocks closed unchanged.

The combination of a 476% increase in trading value, heavy concentration in three financial stocks and negative market breadth suggests that the N637.83 billion turnover figure was driven by exceptional activity in a relatively small part of the market rather than a uniform surge in trading across listed equities.