Tag: equities

Nigerian equities lost N137 billion in successive decline as investors closed 20,740 deals last week. While the momentum of activities improved marginally, most transactions were closed at lower prices.

Benchmark indices at the Nigerian stock market indicated average decline of 1.25 per cent for the week, equivalent to net capital depreciation of N137 billion. With this, the average year-to-date return worsened to -8.22 per cent.

Despite the announcement of the reappointment of the Central Bank of Nigeria (CBN) Governor, Mr Godwin Emefiele, for a second term of five years on Wednesday, the stock market traded all through the week on the negative.

With nearly three decliners for every advancer, aggregate market value of all quoted equities on the Nigerian Stock Exchange (NSE) dropped from the week’s opening value of N10.979 trillion to close weekend at N10.842 trillion. The All Share Index (ASI)- the main benchmark index for the equities market, also declined from its opening index of 29,212.00 points to close at 28,847.81 points.

Total turnover stood at 1.48 billion shares worth N10.88 billion in 20,740 deals compared with a total of 1.47 billion shares valued at N15.50 billion traded in 18,092 deals two weeks ago. Financial services sector remained the most active sector, with 919.60 million shares valued at N7.54 billion in 11,975 deals, representing 62.3 per cent and 69.4 per cent of the total equity turnover volume and value respectively. The information and communication technology (ICT) sector followed with 204.019 million shares worth N58.786 million in 570 deals while the oil and gas sector placed third with a turnover of 154.554 million shares worth N251.781 million in 1,735 deals.

Access Bank Plc, Courtville Business Solutions Plc and United Bank for Africa (UBA) were the three most active stocks and accounted for 503.716 million shares worth N2.338 billion in 2,754 deals. The three most active stocks accounted for 34.11 per cent and 21.50 per cent of the total equity turnover volume and value respectively.

A total of 97,154 units of Exchange Traded Products (ETPs) valued at N1.318 million were also traded in two compared with a total of 1.190 million units valued at N10.967 million traded in 12 deals penultimate week.

In the sovereign debt market, a total of 265 units of Federal Government bonds valued at N281,655 were traded in five deals compared with a total of 14,589 units valued at N15.164 million traded in 12 deals two weeks ago.

There were 49 decliners against 18 gainers. Beta Glass Plc recorded the highest gain, in percentage terms, with a gain of 23.1 per cent to close at N68.95. Courteville Business Solutions followed with a gain of 13.6 per cent to close at 25 kobo while NEM Insurance rose by 13.1 per cent to close at N2.50 per share.

Goldlink Insurance led the losers with a drop of 36.1 per cent to close at 23 kobo. Japaul Oil and Maritime Services followed with a loss of 33.3 per cent to close at 26 kobo while Neimeth International Pharmaceuticals declined by 25.4 per cent to close at 50 kobo per share.

Most analysts remained cautious of the immediate to short-term outlook of the market, although analysts were unanimous on the upside potential of the market.

“In the coming week, we anticipate a bearish performance as foreign investors remain on the side-lines in the absence of major economic triggers,” Afrinvest Securities stated.

“In our view, the sell-offs in the Nigerian equities market is overdone compared to peer markets. This provides a basis for the ASI to recover in the absence of further downside risks. Beyond the obvious, we believe that the blend of positive macroeconomic fundamentals and compelling valuations supports our view of a near term recovery,” Cordros Capital stated.

Nigerian equities lost N548 billion in capital depreciation last week as regulatory deadline for the submission of audited yearly report for the 2018 calendar year elapsed. The decline at the market was contrary to largely positive trends in the global equities markets.

The 90-day period for the submission of yearly reports and accounts for the year ended December 31, 2018 ended on March 31, 2019. Companies quoted on the Nigerian Stock Exchange (NSE) are required to submit their audited yearly reports and financial statements not later than 90 days after the end of the business year.

The stock market witnessed a strong selloff as investors appeared to ignore relatively steady corporate earnings and dividend recommendations. With nearly four decliners for every advancer, most transactions were closed at discount, turning the market into a buyer’s market.

Benchmark indices at the Exchange indicated average decline of 4.59 per cent for the week, equivalent to net capital loss of N548 billion. With the decline during the week, the negative average year-to-date return worsened to -5.77 per cent.

The All Share Index (ASI), the value-based common index that tracks share prices at the Exchange, declined from the week’s opening index of 31,041.42 points to close weekend at 29,616.38 points. Aggregate market value of all quoted equities dropped from the week’s value-on-board of N11.672 trillion to close the week at N11.124 trillion.

Sectoral indices showed a market-wide depression with selloffs more pronounced in the consumer goods sector. The NSE 30 Index, which tracks the 30 largest stocks at the Exchange, recorded average decline of 4.92 per cent during the week. The NSE Consumer Goods Index recorded the highest drop of 7.73 per cent. The NSE Industrial Goods Index followed with -6.48 per cent. The NSE Banking Index trailed with a drop of 6.09 per cent while the NSE Insurance Index depreciated by 3.86 per cent.

There were 55 decliners against 14 advancers during the week compared with 36 losers and 21 gainers recorded in the previous week. Eterna recorded the highest loss, in percentage terms, of 24.53 per cent to close at N4. Union Diagnostic & Clinical Services followed with a drop of 23.33 per cent to close at 23 kobo. United Bank for Africa dropped by 19.48 per cent to close at N6.20. Beta Glass lost 18.9 per cent to close at N58.35. Neimeth International Pharmaceuticals dropped by 17.7 per cent to close at 51 kobo while Dangote Flour Mills declined by 16.18 per cent to close at N8.55 per share.

On the positive side, Ikeja Hotel led the advancers with a gain of 20.2 per cent to close at N2.26. Chams followed with a gain of 20 per cent to close at 24 kobo. Sovereign Trust Insurance rose by 15 per cent to close at 23 kobo. First Aluminium added 10 per cent to close at 33 kobo and Berger Paints rose by 9.7 per cent to close at N9.05 per share.

The momentum of activities increased significantly, although most trades closed on the negative. Total turnover rose to 3.54 billion shares worth N20.26 billion in 19,130 deals last week compared with a total of 2.63 billion shares valued at N12.79 billion traded in 15,558 deals two weeks ago.

Sectoral breakdown showed that the financial services industry remained atop activity chart with 3.06 billion shares valued at N14.47 billion in 11,738 deals; representing 86.35 per cent and 71.40 per cent of the total equity turnover volume and value. The Information and Communication Technology (ICT) staged a rare second on the chart with 253.63 million shares worth N53.71 million in 277 deals. The consumer goods industry ranked third with a turnover of 65.5 million shares worth N4.36 billion in 2,732 deals.

Investors also appeared to be ignoring liquidity constraint and increasingly shifting towards low-priced stocks, otherwise known as penny stocks, which tend to have higher dividend yield. The trio of Wema Bank Plc, Sterling Bank Plc and Chams Plc were the most active stocks last week, accounting for 2.10 billion shares worth N2.03 billion in 965 deals, contributing 59.38 per cent and 10 per cent of the total equity turnover volume and value.

There were no trading in Exchange Traded Products (ETPs) during the week while a total of 18,042 units of Federal Government Bonds valued at N19.685 million were traded in 24 deals last week as against a total of 3,453 units valued at N3.565 million traded in 24 deals penultimate week.

The week opened with the listing of the N15 billion green bond by Access Bank and the listing of additional shares of 6.62 billion ordinary shares of 50 kobo each in the name of Access Bank following the conclusion of the merger between Access Bank and Diamond Bank. Diamond Bank was subsequently delisted.

The equities market counteracted the bullish trading in most advanced and emerging markets. In the United States, the Dow Jones Industrial Average (DJIA) rose by two per cent and the S & P 500 and NASDAQ grew by 1.9 per cent and 2.7 per cent respectively. In the United Kingdom, the UK FTSE appreciated by 2.2 per cent. France’s CAC 40 Index posted a gain of 2.3 per cent. Germany’s XETRA DAX Index rose by 4.1 per cent. Japan’s Nikkei 225 Index posted a gain of 2.8 per cent while the Hong Kong’s Hang Seng Index rallied three per cent.

In the emerging markets bloc of Brazil, Russia, India, China and South Africa (BRICS), investors were overtly bullish on emerging stocks. As optimism grew on the USA-China relationship, the China Shanghai Composite Index rallied by 5.0 per cent. Russia’s RTS Index rose by 2.5 per cent. India’s BSE Sens appreciated by 0.5 per cent. South Africa’s FTSE/JSE All Share Index rose by 2.5 per cent while Brazil Ibovespa Index rallied by 1.1 per cent.

Across the regions, Europe’s Euro Stoxx 50 rose by 2.8 per cent. The MSCI EM Index, which tracks emerging stocks, appreciated by 2.1 per cent while the MSCI FM Index, which tracks frontier markets, inched up by 0.4 per cent.

In Africa, most markets traded on the positive side. Egypt’s EGX30 Index showed average gain of 4.0 per cent. Morocco’s Casablanca MASI appreciated by 0.7 per cent. Mauritius’ SEMDEX Index rose by 0.6 per cent and Kenya’s NSE 20 Index was flat. However, Ghana’s GSE Composite Index indicated average decline of 0.4 per cent.

Analysts’ consensus indicated cautious optimism with most analysts urging investors to be cautious and invest on fundamentally sound stocks.

Analysts at Cordros Capital noted that in the absence of a positive catalyst, investors need to trade cautiously in the short term.

“However, stable macroeconomic fundamentals and compelling valuation remains supportive of recovery in the mid-to-long-term,” Cordros Capital stated.

Afrinvest Securities pointed out that despite the overall negative performance last week, there were observed increase in buying activity on bellwether stocks, noting that this trend may be sustained this week as investors seek to take position in attractively priced stocks.

“However, in the absence of major triggers that could drive positive sentiments, we maintain a bearish near-term outlook,” Afrinvest Securities stated.

After five days of consecutive negative session, Nigerian equities witnessed marginal recovery yesterday as bargain-hunters increased buy orders for value stocks. While there were more decliners than advancers, gains by large and mid-cap stocks roused the market to its first gain in six days.

Benchmark indices at the Nigerian Stock Exchange (NSE) indicated average gain of 0.15 per cent, equivalent to net capital gain of N18 billion. Average year-to-date return, though still negative, improved to -0.22 per cent.

The All Share Index (ASI)- the common value-based index that tracks share prices at the Exchange, inched up to 31,360.28 points as against its opening index of 31,313.36 points. Aggregate market value of all quoted equities rose from its opening value of N11.677 trillion to close at N11.695 trillion.

Sectoral indices showed mixed performance across the sectors. The NSE Banking Index rose by 0.04 per cent. The NSE Consumer Goods Index appreciated by 1.60 per cent while the NSE Oil and Gas Index closed flat. However, the NSE Industrial Goods Index declined by 0.35 per cent while the NSE Insurance Index dipped by 0.02 per cent.

There were 13 advancers against 18 decliners. Nestle Nigeria, NSE’s highest-priced stock, led the rally with a gain of N69.90 to close at N1,549.90. CAP followed with a gain of N3.40 to close at N37.40. Okomu Oil Palm added N1 to close at N80. Eterna rose by 40 kobo to close at N4.80. Sterling Bank chalked up 21 kobo to close at N2.36 while Guaranty Trust Bank added 20 kobo to close at N35.70 per share.

On the negative side, Guinness Nigeria led the losers with a loss of N3.15 to close at N64. Dangote Cement lost N2 to close at N192. Dangote Flour Mills declined by 50 kobo to close at N9.50. Africa Prudential dropped by 37 kobo to close at N4.55 while UAC of Nigeria lost 20 kobo to close at N7.80.

“Today’s rebound in the domestic equities market was in line with our expectations, and in our view, sustained bargain hunting will further buoy market performance over the near term,” Afrinvest Securities stated.

Total turnover stood at 377.49 million shares valued at N2.26 billion in 3,273 deals. Diamond Bank led the activities chart with a turnover of 113.6 million shares worth N283.36 million. Chams followed with 72.15 million shares worth N14.43 million while FBN Holdings placed third with 71.53 million shares worth N586.23 million.

Analysts at Cordros Capital remained cautious, urging investors “to trade cautiously in the short term” while reiterating optimism that “stable macroeconomic fundamentals and compelling valuation remain supportive of recovery in the mid-to-long term”.