Analysts expect bargain hunting opportunities to boost Nigerian stock market trading activities this week.
The sell sentiment on equities on the Nigerian Exchange have continued as profit booking hit highly priced stocks and blue chip companies, weighing in on the benchmark NGX All-Share index which closed lower on a very high traded volume, amidst negative market breadth.
In the new week, analysts at Cowry Assets Management Limited said, “we anticipate a blend of mixed sentiments in the market, with positive momentum counterbalanced by profit-taking activities as we approach another potential peak or a possible fake out.
He said: “This uncertainty is further fueled by the upcoming half-year earnings reports from Access Holdings, while investors are likely to continue in portfolio reshuffling in preparation for the quarter-end reporting season. Meanwhile, we continue to advise investors on taking positions in stocks with sound fundamentals.”
Cordros Securities Limited said: “in the short term, we anticipate cautious trading in the local stock market due to the absence of significant positive catalysts to boost sentiments.
“Overall, we reiterate the need for positioning in only fundamentally sound stocks as the unimpressive macro environment remains a significant headwind for corporate earnings.”
Last Week’s Trading Activities
The domestic bourse closed lower for the second consecutive week, exhibiting weak momentum as investors cherry-picked on highly priced, low, and medium-cap companies despite the postponement of the Central Bank of Nigeria’s upcoming policy meeting and assumption of office by the new acting CBN governor, and the quarter-end window dressing by fund managers.
Thus, the All-Share Index dipped by 0.11 per cent week-on-week (W-o-W) to close at 67,324.59 points. Similarly, market capitalisation shed N39 billion W-o-W to close at N36.847 trillion.
The sectoral performance for the week is largely positive. The NGX Insurance index emerged as the top gainer by 3.34 per cent week on week. NGX Consumer Goods index followed with a weekly gain of 2.98 per cent, while NGX Banking and the Oil & Gas indices rose by 0.61 per cent and 0.56 per cent W-o-W. On the contrary, the NGX Industrial Goods index closed the week negative by 4.80 per cent.
However, market breadth for the week was positive as 48 equities appreciated in price, 40 equities depreciated in price, while 67 equities remained unchanged. SUNU Assurances led the gainers table by 32.91 per cent to close at N1.05, per share. Ellah Lakes followed with a gain of 28.79 per cent to close at N4.25, while e-Tranzact International went up by 28.57 per cent to close to N9.45, per share.
On the other side, Tantalizers led the decliners table by 21.05 per cent to close at 30 kobo, per share. Guinea Insurance followed with a loss of 20.69 per cent to close at 23 kobo, while McNichols declined by 13.33 per cent to close at 65 kobo, per share.
Overall, a total turnover of 3.911 billion shares worth N30.379 billion in 38,536 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 2.933 billion shares valued at N47.449 billion that exchanged hands previous week in 44,654 deals.
The Financial Services Industry (measured by volume) led the activity chart with 2.774 billion shares valued at N15.241 billion traded in 16,379 deals; contributing 70.92 per cent and 50.17 per cent to the total equity turnover volume and value respectively.
The Oil and Gas Industry followed with 438.508 million shares worth N5.203 billion in 6,258 deals, while the ICT Industry traded a turnover of 294.470 million shares worth N4.447 billion in 3,078 deals.
Trading in the top three equities; Universal Insurance, Oando and United Bank for Africa (measured by volume) accounted for 2.212 billion shares worth N8.907 billion in 7,593 deals, contributing 56.56 per cent and 29.32 per cent to the total equity turnover volume and value respectively.