UBA, FirstHoldCo Drive Banking Slump As Market Loses N1.37trn

The Nigerian equities market opened the week on a bearish note on Monday, as sustained selloffs in banking stocks led by United Bank for Africa and FirstHoldCo, dragged the broader market lower, wiping out N1.37trn in investor value in one day.

At the close of trading, the benchmark NGX All-Share Index declined by 0.94 per cent to settle at 223,602.29 points. This pulled the year-to-date return down to 43.69 per cent, while total market capitalisation fell to N143.97 trillion, reflecting heightened investor caution and profit-taking activities.

The downturn was largely driven by a sharp 6.49 per cent decline in the banking sector, which offset gains recorded in other segments of the market. Market breadth closed negative at 0.9x, with 40 decliners outpacing 35 gainers. Alongside UBA and FirstHoldCo, other major laggards included Access Holdings and Fidelity Bank, reinforcing the broad-based weakness across banking equities.

In contrast, select stocks provided some support to the market. Abbey Mortgage Bank, Wema Bank and Wapic Insurance were among the notable gainers, although their performance was insufficient to counterbalance losses in heavyweight banking stocks.

Sectoral performance reflected the mixed sentiment in the market. The industrial index rose by 0.85 per cent, supported by gains in bellwether stocks such as Dangote Cement, while the commodities and insurance sectors posted modest gains of 0.63 per cent and 0.15 per cent respectively. However, declines in the banking, consumer goods (-0.41 per cent) and oil and gas (-0.24 per cent) sectors ultimately dragged the overall index into negative territory.

Trading activity presented a mixed picture. Total volume traded increased by 8.06 per cent to 678.17 million shares, while the number of deals surged by 49.98 per cent to 82,838 transactions, indicating heightened market participation. However, the total value of trades edged down slightly by 0.85 per cent to N44.14bn, suggesting cautious positioning by investors amid prevailing uncertainties.

A similar bearish trend persisted in subsequent trading, with the All-Share Index declining further by 0.98 per cent, bringing the year-to-date return marginally lower to 43.64 per cent and reducing market capitalisation to N143.92trn. Key market movers during the session included Zenith Bank, MTN Nigeria, Guaranty Trust Holding Company, Access Holdings and Dangote Cement.

On the gainers’ chart, Abbey Mortgage Bank, Zichis and Wema Bank recorded the most significant price appreciation, each posting gains of over 8 per cent. Conversely, FirstHoldCo, Transnational Express and UBA led the losers’ table, each shedding 10 per cent of their share value, underscoring the intensity of the selloff in key counters.

Market analysts attribute the bearish performance primarily to profit-taking following the market’s strong rally in recent months, particularly within the banking sector, which had previously driven much of the year’s gains. The sharp pullback in banking stocks is seen as a correction phase, as investors rebalance portfolios and lock in profits.

Looking ahead, analysts expect the market to maintain a cautious and potentially negative bias in the near term, as profit-taking pressures persist and investors remain sensitive to macroeconomic signals. The performance of banking stocks, particularly heavyweights such as UBA and FirstHoldCo, is likely to remain a key determinant of overall market direction in the coming sessions.