Stock market operators have expressed optimism that trading on the nation’s bourse would close bullish ahead of Christmas holidays as investors position for dividend paying stocks for 2021 financial year.
They said this in interviews with journalists in Lagos on Sunday, while speaking on expectations for the stock market in the new week.
Malam Garba Kurfi, Managing Director, APT Securities and Funds Ltd., said investors were expected to take position on double digit dividends yield ahead of 2021 financial year.
Kurfi expressed optimism that the stock market would close the week positive in spite of the Christmas break.
“Many investors will like to take position on those stocks that have double digit dividends yield since most of them declare and pay in the next four to five months.
“We expect to close more positively despite Christmas break,” Kurfi said.
He noted that the All-Share Index presently had recorded a negative growth of over two per cent.
Kurfi, however, anticipated that the ASI would recover and close positively for the month and the year on renewed interest, drop in volume and value of shares traded to MTN Nigeria Communications Initial Public Offering (IPO).
Kurfi noted that many investors sold their portfolio in order to participate in the offer.
Also speaking, Mr Ambrose Omordion, Chief Operating Officer, InvestData Ltd., said investors were already taking positive in the dividend paying stocks ahead of earning season for 2021 financial year.
Omordion said they were taking positive in blue chip stocks that were consistent with dividend payments.
He said that positive macroeconomic indices contributed to investors renewed confidence in the stock market in spite of the security challenges in some parts of the country.
Also, analysts at Cordros Research expressed optimism the stock market performance would close positive ahead of Santa Claus holidays.
“We expect market performance to be dominated by the bulls in the week ahead, as positioning by early birds in dividend-paying stocks ahead of 2021FY dividend declarations should outweigh profit-taking activities.
“Notwithstanding, we reiterate the need for positioning in only fundamentally sound stocks as the weak macro environment remains a significant headwind for corporate earnings,” they said.
The NGX All-Share Index increased by 470.24 points or 0.12 per cent last week to close at 42,353.21 from 41,882.97 achieved in the preceding week.
Also, the market capitalisation inched higher by N253 billion to close at N22.107 trillion against N21.854 trillion posted in the previous week.
A breakdown of the activity chart showed that 32 equities appreciated in price, lower than 35 equities in the previous week.
A total turnover of 1.32 billion shares worth N15.33 billion was traded by investors in 18,292 deals.
This was in contrast with 2.63 billion shares valued at N26.90 billion exchanged in 20,848 deals in the corresponding week.
The Financial Services Industry (measured by volume) led the activity chart with 899.77 million shares worth N7.33 billion traded in 9,326 deals.
The sector contributed 68.32 per cent and 47.78 per cent to the total equity turnover volume and value, respectively.
The consumer goods industry followed with 209.50 million shares worth N2.79 billion in 2,866 deals.
The third place was the conglomerates industry, with a turnover of 93.81 million shares worth N663.14 million in 485 deals.
Reports that the NGX place Studio Press Nigeria Plc on full suspension on Dec. 17.
“The suspension is necessary to prevent trading in the shares of the company beyond the effective date of the Scheme of Arrangement between Studio Press and its shareholders involving the transfer of the ordinary shares held by minority shareholders to Federated Resources Nigeria Ltd at N1.99 per share.”
The Scheme of Arrangement would result in the delisting of the company from the Daily Official List of the NGX.