Analysts from securities companies are optimistic of stock market uptrend this week on Dangote Cement Plc shares buy-back programme and positioning for 2021 full year financial results.
Analysts at Cowry Assets Management Limited say they expect the equities market index to further rise as investors buy more shares, especially Dangote Cement Plc, as it rounds up the shares buy-back programme in the new week.
In the short term, analysts at Cordros Securities Limited expect the bulls to retain dominance in the market given positioning for 2021 full year dividends as institutional investors continue to search for clues on the direction of yields in the fixed income (FI) market, saying, “notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings.”
However, analysts at Afrinvest Limited stated that, “in the coming week, we expect market performance to be a mix of profit-taking and bargain hunting activities.”
Last Week’s Trading Activities
Sentiments remained broadly bullish in the second trading week of the year as investors continued to cherry-pick stocks with attractive dividend yields ahead of 2021 full year dividend declarations.
The All-Share Index rose by 1.37 per cent week-on-week (W-o-W) to close at 44,454.67 points. Similarly, market capitalisation gained N323 billion W-o-W to close at N23.951 trillion. Pertinently, bargain hunting in BUA Foods, Dangote Cement, Guinness Nigeria and International Breweries drove the weekly gain.
Given the bullish sentiment, most sector gauges tracked closed in green. Particularly, the NGX Oil & Gas, NGX Banking and the NGX Industrial indices rose by 1.74 per cent, 0.75 per cent and 3.56 per cent respectively to close at 360.41 points, 412.30 points and 2,086.99 points respectively. The announcement of Dangote’s Tranche II share buy-back programme also contributed to the rise in industrial index. On the flip side, the NGX Consumer Goods index and the NGX Insurance indices lost 1.54 per cent and 4.35 per cent to close at 193.23 points and 558.72 points respectively.
However, market breadth for the week was negative as 33 equities appreciated in price, 35 equities depreciated in price, while 88 equities remained unchanged. BUA Foods led the gainers table by 24.06 per cent to close at N66.00, per share. Transnational Corporation of Nigeria (Transcorp) followed with a gain of 16.33 per cent to close at N1.14, while Jaiz Bank went up by 15.25 per cent to close to 68 kobo, per share.
On the other side, SUNU Assurance Nigeria led the decliners table by 16.22 per cent to close at 31 kobo, per share. Mutual Benefits Assurance followed with a loss of 12.90 per cent to close at 27 kobo, while Berger Paints declined by 9.94 per cent to close at N7.70, per share.
Overall, a total turnover of 1.600 billion shares worth N32.716 billion in 22,607 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 2.027 billion shares valued at N59.014 billion that exchanged hands last week in 15,750 deals.
The Financial Service Industry (measured by volume) led the activity chart with 731.264 million shares valued at 6.517 billion traded in 10,822 deals; contributing 45.71 per cent and 19.92 per cent to the total equity turnover volume and value respectively. The Conglomerate Industry followed with 403.646 million shares worth N 452.909 million in 1,537 deals, while the Consumer Goods Industry pulled a turnover of 314.768 million shares worth N17.759 billion in 4,101 deals.
Trading in the top three equities namely Transcorp, BUA Foods, Jaiz Bank (measured by volume) accounted for 775.685 million shares worth N16.625 billion in 2,644 deals, contributing 48.49 per cent and 50.82 per cent to the total equity turnover volume and value respectively.