Despite the negative performance of the Nigerian stock market last week, analysts have predicted that bullish sentiments would regain dominance in the market given the moderation in the prices of bellwether stocks, this week.
In the new week, analysts at Cowry Assets Management Limited expect the local stock market to be bullish amid renewed interest in banking shares, saying “hence, we feel this would spread across other real sector companies too as evident in the share price of Guinness Nigeria among others.”
Analysts at Cordros Securities stated, “in the week ahead, we expect the bulls to regain dominance in the market given the moderation in the prices of bellwether stocks in the last three weeks. However, we do not rule out the possibility of continued profit-taking activities.
“In addition, we believe the outcome of the bond auction scheduled to hold during the week will also shape market sentiments. Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings.”
However, Afrinvest Limited expected market performance to be a mix of profit-taking and bargain hunting activities this week.
Last Week’s Trading Activities
The domestic stock market last week closed southward amid sustained weak sentiment, especially on the cement giant shares, Dangote Cement. Amid sustained profit taking activity on the local bourse, the All-Share Index (ASI) fell week-on-week (W-o-W) by 284.94 points or 0.68 per cent to close at 41,882.97 points. Similarly, market capitalisation declined N149 billion W-o-W to close at N21.854 trillion.
On the positive side, the equities market appeared to be recovering from the bearish turn as most sub-indices tracked closed strongly in green. The NGX Banking, NGX Insurance, NGX Consumer Goods and NGX Oil & Gas indices gained 5.55 per cent, 1.24 per cent, 0.11 per cent and 1.27 per cent to close at 402.71 points, 190.86 points, 546.96 points and 352.67 points respectively. However, the NGX Industrial index fell by 5.42 per cent to close at 2,073.32 points.
The market breadth for the week was negative as 35 equities appreciated in price, 27 equities depreciated in price, while 94 equities remained unchanged. Meyer Plc led the gainers table by 50.00 per cent to close at 33 kobo, per share. Consolidated Hallmark Insurance followed with a gain of 25.00 per cent to close at 55 kobo, while Academy Press went up by 20.51 per cent to close to 47 kobo, per share.
On the other side, Unity Bank led the decliners table by 15.69 per cent to close at 43 kobo, per share. Dangote Cement followed with a loss of 10.00 per cent to close at N252.00, while Linkage Assurance declined by 8.93 per cent to close at 51 kobo, per share.
Overall, a total turnover of 2.630 billion shares worth N26.900 billion in 20,848 deals were traded last week by investors on the floor of the Exchange, in contrast to a total of 1.278 billion shares valued at N17.340 billion that exchanged hands previous week in 21,052 deals.
The Financial Services Industry (measured by volume) led the activity chart with 2.234 billion shares valued at N21.449 billion traded in 11,482 deals; contributing 84.95 per cent and 79.73 per cent to the total equity turnover volume and value respectively. The Services Industry followed with 157.089 million shares worth N695.798 million in 465 deals, while the Consumer Goods Industry traded a turnover of 71.016 million shares worth N1.708 billion in 3,019 deals.
Trading in the top three equities; FBN Holdings, Sterling Bank and C & I Leasing (measured by volume) accounted for 1.607 billion shares worth N14.751 billion in 1,646 deals, contributing 61.13 per cent and 54.84 per cent to the total equity turnover volume and value respectively.
On Exchange Traded Products (ETPs) platform, a total of 47 units valued at N208,310.73 were traded last week in six deals compared with a total of 13,481 units valued at N714,329.90 transacted previous week in 15 deals, while on the Bond market, a total of 32,269 units valued at N32.476 million were traded last week in 17 deals compared with a total of 3,344 units valued at N3.603 million transacted last week in seven deals.