Profit taking in oil and gas stocks led to a negative close at the stock market on Tuesday as the Nigerian Stock Exchange (NSE) All-Share Index (ASI) fell marginally by 0.05 per cent to 28,248.86. Specifically, Conoil Plc, which recorded an unprecedented rise due to an impressive 2015 full year and 2016 half year results, went down by 7.0 per cent to be at N36.00. Similarly, Oando Plc shed 4.8 per cent to close at N5.32.
Conoil Plc had appreciated by 97 per cent within seven trading days due to impressive results. The stock, which was N21.59 before the full year results were released on September 9, soared to close at N42.60 per share last week.
“I am not surprised at the way the stock is rising given the better-than-expected performance despite the challenging operating environment. But I think profit taking may set in soon as some investors may want to lock part of the gains recorded by the stock,” a stockbroker, Mr. Ayo Oguntayo said. The company had posted a profit before tax of N3.448 billion for the year ended December 31, 2015, up by 125 per cent fromN1.532 billion in 2014.
Conoil followed the full year performance with similarly impressive results for the half year ended June 30, 2016. Conoil Plc grew its profit before tax by 196 per cent to N1.566 billion, from N548 million in 2015, while profit after tax rose by 190 per cent to N1.04 billion. Due to the profit taking, the Oil & Gas Index emerged the sole decliner, shedding 0.9 per cent.
The NSE Insurance Index gained 0.4 per cent on the back of price appreciation in Law Union & Rock Insurance Plc (+7.0 per cent) and Continental Insurance Plc (+3.1 per cent). The NSE Consumer Goods index followed suit, up 0.3 per cent due to bargain-hunting in Guinness (+5.0 per cent) and Flour Mills of Nigeria Plc (+4.6per cent). Also, the NSE Banking Index rebounded from a 3-day losing streak to gain 0.1 per cent on account of Wema Bank Plc (+4.5 per cent) and Zenith Bank Plc (+0.9 per cent).