Early morning stock market data indicates investors are dumping Diamond Bank shares in droves. The share price is currently 9% down.
The stock opened trading this week at N3.57 and closed Wednesday, January 24th and N2.92 representing a 26.6% drop this week alone.
According to a chart from the Nigerian stock Exchange (NSE) over 100 million shares of the stock are on offer by investors at a price of N2.65 with no buyer in sight (as at 11.30am on Thursday). Typically, a full offer of this nature indicates a massive sell-off of the stock and a downward trend in the price of the stock.
Before this week, Diamond Bank was up 110% year to date and one of the best gainers in 2018. This is despite investor sentiments that suggest the company’s results may be disappointing for 2017 amidst rising impairments on loans.
Some analysts we spoke to suggested that the recent rally was due to rumours that the bank may be embarking on a rights issue or public offer, which is typically preceded by rally in share price.
Investors may want to be circumspect about the current situation and track the share price all day long and cut losses where applicable.