The Nigerian Exchange (NGX) concluded Tuesday’s trading session in a near-standstill, with the All-Share Index (ASI) shedding a marginal 0.01% as sustained sell pressure on tier-1 banking names fully negated gains in heavyweight telecom counters.
The benchmark index settled at 106,251.40 basis points, while market capitalization closed flat at ₦61.42 trillion. However, beneath the headline stability, a distinct two-speed market emerged. Traders rotated out of financial services long the market’s liquidity bedrock, piling into defensive telecom assets amid renewed concerns over banks’ asset quality.
The NGX Banking Index fell 0.8%, its third consecutive daily decline. Zenith Bank PLC and Guaranty Trust Holding Co. (GTCO) accounted for over 70% of the sector’s drag, shedding 1.2% and 0.9%, respectively. Market sources cited profit-taking following a 12% run-up in banking shares over the previous four weeks, alongside anxiety ahead of interim regulatory stress-test results expected later this week.
“Investors are repositioning ahead of the mid-quarter macro data,” said Bola Ademola, a portfolio manager at Lagos based FBN Quest. “Banks have run hard, but telecoms offer a clearer near-term yield story, especially with the naira stabilizing.”
Contrarily, MTN Nigeria Communications PLC advanced 1.5% to ₦245.00, while Airtel Africa PLC gained 0.9%. Both stocks benefited from renewed foreign portfolio interest, aided by the central bank’s continued clearance of outstanding forex backlogs a key overhang that had previously weighed on telco valuations.
Market breadth turned negative, with 22 decliners against 19 advancers. Total turnover fell 14% from the previous session to 312 million shares, valued at ₦4.9 billion.
Analysts at Cordros Capital note that while the ASI’s flat close suggests equilibrium, underlying sectoral rotation implies elevated near-term volatility. They advise a barbell strategy combining resilient telcos with selectively undervalued insurers, until the banking sector’s stress test findings are published.
