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NSE ASI extends loss amidst broad market sell off

What shaped the market today?

• Despite a surge in the Industrial Goods sector, the NSE ASI dipped further in the red following sell-offs across board. On the global front, Asian stocks traded mostly in the green after Chinese PMI for January came in at 51.3, beating a forecast of 51.2. European and U.S. markets were also higher as investors digested earnings releases and looked ahead to the U.S. Federal Open Market Committee meeting later in the day for clues on monetary policy.
• The Consumer Goods sector (-321bps) posted the session’s largest decline to extend its year-to-date loss to double digits, following declines in sector heavyweights - GUINNESS (-499bps), UNILEVER (-499bps), NESTLE (-372bps), NB (-354bps) and FLOURMILL (-270bps). The Oil & Gas (-231bps) was next in line, pressured by losses in FO (-500bps), TOTAL (-414bps), SEPLAT (-260bps) and OANDO (-215bps). The Banking sector (-47bps) also traded lower following extended losses in DIAMONDBNK (-213bps), ZENITHBANK (-197bps) and GUARANTY (-105bps). The Industrial Goods sector (+407bps) however surged on the back of advances in WAPCO (+827bps) and DANGCEM (+120bps).
• Market breadth remained negative with 9 advances and 27 declines.

What will shape the next trading session?

• The fact that today’s loss came amidst gains in heavily weighted Industrials stocks shows the extent of the bearish sentiment in the market. On that note, we expect the NSE ASI to drop more points in the coming session.