Despite the losses recorded in the month of October, Fidelity Bank, Diamond Bank and Newrest ASI led other 33 gainers for the month.
Mixed trading was the theme for domestic equities in October, as earnings releases played a key role in swinging investor sentiments. Political concerns and slow-paced economic growth also negatively impacted investor’s sentiments during the period. As a result, the ASI dropped 0.92 per cent month-on-month to 32,466.27 points.
During the month, market breadth was negative with decliners outpacing advancers in the ratio of 68:36 to continue nine months of decline. There was however a slowdown in losses as many stocks reacted positively to their earnings.
Fidelity Bank was the best performing stock last month, with a gain of 20 per cent to close at N2.04, per share. Diamond Bank was next with a 19.49 per cent gain to close at N1.41, while Newrest ASL Nigeria rose by 17.86 per cent last month to close at N6.60, per share.
Consolidated Hallmark Insurance gained 13.79 per cent to close at 33 kobo, Cornerstone Insurance appreciated by 10 per cent to close at 22 kobo, while Cadbury Nigeria gained by 9.89 per cent to closed at N10, per share.
Others are Forte Oil, Zenith Bank, Total Nigeria and Mutual Benefit Assurance gained 9.73 per cent, 9.30 per cent, 8.20 per cent and 7.14 per cent, respectively to the month at N22, N23.50, N183 and 30 kobo, per share in that order.
Speaking on the performance on some of these stocks, the chief operating officer of InvestData Consulting Limited, Ambrose Omordion said that the financial service stocks topped the best performing stocks as they closed stronger on low valuation attraction and mild improvements recorded in their third quarter results.
He pointed out that the mixed numbers released during the month impacted prices positively, although the scorecards came most times below market forecast, as investors took advantage of the low stock prices owing to prolonged pullbacks as funds exited emerging markets to develop economies.
He added that there were also factors like the continued hike in interest rate in the developed economies, just as the lingering political uncertainties surrounding Nigeria’s 2019 general elections, added to the weak economic fundamentals and negative sentiments, following which investors are running for safety.
On outlook for equities, analysts at Cordros Capital Limited stated that in the medium term remain conservative, as jitters surrounding the upcoming elections are likely to intensify as the date draws closer, and the absence of a positive catalyst fails to give respite to the expected sell pressure.
However, they said that recovery is likely in the long term, amidst stable macroeconomic fundamentals.