Cadbury’s 2016 result triggers negative reaction on stocks

Cadbury Nigeria Plc led 24 declining stocks on Tuesday amidst weak earnings posted by the company in its 2016 financial year.

The company, which released its full year audited statements to the Nigerian Stock Exchange on Tuesday recorded a loss of N296.4 million, representing a decline of 126 percent, from a profit of N1.2 billion, recorded as profit in 2015.

Cadbury’s share price consequently dropped by 5 percent at the close of trading to settle at N7.41 per share.

Trailing Cadbury on the losers chart was Guinness Nigeria Plc with a depreciation of 4.99 percent to close at N60.03 while Meyer lost 4.82 percent to close at 79 kobo per share.

Nigerian Aviation Handling Company of Nigeria also lost 4.76 percent from its previous share price to settle at N2 and Jaiz Bank emerged the day’s fifth topmost loser to close at N1.27, having lost N4.51 per share.

On the other hand, Julius Berger led 12 other stocks with a gain of 5.26 percent to close at N40, Livestock feeds followed with a growth of 4.76 percent to close at 66 kobo per share, NASCON added 4.71 percent to close at N7.12, Cement Company of Northern Nigeria appreciated 4.44 percent to close at N4.70 while Fidson completed the day’s five top gainers with an increase of 4.30 percent to close at 97 kobo per share.

Stock market activities consequently closed in red for the first time, after trading positive for five consecutive sessions.

The Nigerian Stock Exchange All Share Index (NSEASI) shed 0.44 percent to close at 25,558.57 points in comparison with 0.07 percent gained on Monday when the ASI closed at 25,671.55 points

Market capitalization settled at N8.843 trillion after losing N39 billion in Tuesday’s trade, compared to a gain of N3.4 billion recorded previously to close at N8.881 trillion.

Volume and Value traded on the NSE also slowed to show dampened investors activities which occurred in 2,675 deals.

Volume of traded stocks declined 69 percent to 153.7 million units as against 495.2 million units previously, while Value of stocks traded fell 40 percent to N1.5 billion compared to N2.5 billion worth of stocks traded Monday.

Meanwhile, at the end of its 255th meeting (second this year), the Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) voted unanimously to maintain status quo by retaining the Monetary Policy Rate (MPR) at 14.0%; Asymmetric corridor around the MPR at +200/-500bps; Cash Reserves Ratio (CRR) at 22.5%; and Liquidity Ratio (LR) at 30.0%.

The Committee again noted that the risk facing the domestic economy is in two folds (i.e. price and output) and reiterated its commitment to price stability while closely monitoring domestic and external developments that could shape subsequent decisions.

The Committee’s decision came in line with consensus, as shown by a Bloomberg-compiled median estimate of 14.0% for the MPR.