By Kayode Tokede
The equities market of the Nigerian Stock Exchange (NSE) gained 1.59 per cent in its weeek0-on-week performance to close at 31,016.17basis points compared to 30,530.69 basis points it opened for activities
The bullish momentum in the local bourse lost steam as investors took a breather to digest corporate earnings released thus far. In terms of activity levels, volume grew by 8.2per cent w/w while value declined 4.1per cent w/w.
Notably, investors’ interest in Dangote Cement Plc (+9.1 per cent), Dangote Sugar Plc (+19.6 per cent), and Guaranty Trust Bank Plc (+3.1per cent) drove the benchmark index 1.6 per cent higher, its seventh-consecutive weekly gain.
The MTD return stood at 1.6per cent while the YTD return for index grew to 15.6 per cent. Performance across sectors was broadly positive.
Save for the Oil and Gas (-0.8 per cent) which declined, the Industrial (+2.9 per cent), Banking (+2.2 per cent), Insurance (+1.3 per cent) and Consumer Goods (+0.6 per cent) indices closed in the green.
The weekly market report stated that, “A total turnover of 2.067 billion shares worth N22.636 billion in 25,187 deals were traded this week by investors on the floor of the Exchange, in contrast to a total of 1.909 billion shares valued at N23.610 billion that exchanged hands last week in 23,578 deals.
“The Financial Services industry (measured by volume) led the activity chart with 1.575 billion shares valued at N13.725 billion traded in 14,521 deals; thus contributing 76.21 per cent and 60.63 per cent to the total equity turnover volume and value respectively.
“The Consumer Goods Industry followed with 178.574 million shares worth N3.609 billion in 4,669 deals. The third place was the Conglomerate Industry, with a turnover of 102.697 million shares worth N155.195 million in 599 deals.
“Trading in the top three equities namely Access Bank Plc, FBN Holding Plc and Zenith Bank Plc (measured by volume) accounted for 686.338 million shares worth N7.599 billion in 4,557 deals, contributing 33.21 per cent and 33.57per cent to the total equity turnover volume and value respectively.
Analysts at Cordros Capital explained that, “As the Q3 earnings season winds down, we expect investors to shift their attention to yet to be published results from the big banks (FUGAZ) in the week ahead. In the short term, we still see scope for expansion in valuation multiples as hunt for alpha-yielding opportunities in the face of increasingly negative real returns in the fixed income market remain positive for stocks.
“However, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings.”