Nigerian equities market suffered another major sell-off on Wednesday as investors scrambled to raise cash ahead of the much-anticipated Initial Public Offering of Dangote Petroleum Refinery and Petrochemicals, wiping N1.67 trillion off the value of listed equities.
The renewed sell-off pushed the NGX All-Share Index down by 1.05 per cent to 242,223.10 points, while the market’s year-to-date return moderated to 55.66 per cent.
Similarly, total market capitalisation fell to N157.05 trillion, reflecting intensified selling across several heavyweight stocks and sectors.
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The market’s breadth underscored the depth of the bearish sentiment, with 43 stocks closing lower against only 11 gainers, leaving the breadth ratio at a weak 0.26x.
Analysts attributed the pressure largely to portfolio repositioning ahead of the Dangote Refinery IPO, as investors increasingly seek to unlock cash from existing equity positions to participate in what is expected to be one of the biggest capital-market transactions in Nigeria.
The sell-off was broad-based, with Omatek Plc emerging as the biggest loser, followed by Zichis Agro-Allied, BUA Cement Plc, FTN Cocoa Processors Plc and Neimeth International Pharmaceuticals Plc.
On the other hand, Champion Breweries Plc, VFD Group Plc, UPDC Plc, Ikeja Hotel Plc and Cutix Plc recorded the strongest gains during the session.
The downturn was particularly severe in the financial and insurance segments.
The Insurance Index plunged 7.31 per cent, while the Banking Index shed 5.79 per cent. The Industrial Goods Index also declined by 3.72 per cent, while the Consumer Goods Index lost 1.61 per cent.
Only the Oil and Gas and Commodity sectors bucked the negative trend. The Oil and Gas Index rose by 5.55 per cent, while the Commodity Index appreciated by 4.04 per cent.
Trading activity also weakened significantly, reinforcing indications that investors are becoming increasingly cautious.
Total volume of transactions declined by 29.04 per cent to 534.45 million shares, while turnover dropped by 19.94 per cent to ₦22.28 billion. The number of deals executed during the session fell by 13.15 per cent to 46,943 transactions.
The latest decline comes as investors prepare for the opening of the Dangote Refinery IPO at the beginning of next week.
The offer is expected to command considerable attention from institutional, retail and foreign investors, given the scale and strategic importance of the refinery to Nigeria’s economy and the potential size of the transaction.
The prospect of a major primary-market opportunity appears to be changing investor behaviour in the secondary market, with some shareholders taking profits from equities that have delivered substantial gains this year and others selling positions to build liquidity for the offer.
This has raised concerns that the equities market could remain under pressure in the immediate term as investors rebalance their portfolios.
The trend could be particularly pronounced among stocks that have recorded significant year-to-date appreciation, as investors weigh the opportunity to participate in the refinery offer against the prospects of further gains in existing holdings.
Market watchers, however, expect the pressure to ease if fresh liquidity enters the market following the IPO, particularly if the offer succeeds in attracting substantial domestic and international subscriptions.
For now, the market remains caught in a liquidity squeeze, with investors positioning for what could be a defining capital-market event.