By Chinwendu Obienyi
Despite the negative performance of the Nigerian stock market last week, analysts have predicted that bullish sentiments would regain dominance in the market given the moderation in the prices of bellwether stocks amid the declining yields in the fixed income (FI) market.
The local bourse was not immune to the rout in global equities as losses recorded on the last trading day (Friday: -0.5 per cent) eroded the cumulative 0.4 per cent gain as of the penultimate trading day. Precisely, selloffs in bellwethers — Nestle(-9.1 per cent), Total (-2 per cent), Access Bank (-1.1 per cent)- drove the market’s All Share Index (ASI) down by 0.1 per cent week-on-week (w/w) to close at 39,483.08 points.
Consequently, investors lost N21 billion as market capitalisation closed the trading week at N20.571 trillion from an opening figure of N20.582 trillion.
Similarly, all other indices finished lower with the exception of NGX Premium, NGX AFR Div Yield, NGX Industrial Goods and NGX Sovereign Bond indices which appreciated by 2.28 per cent, 0.76 per cent, 1.85 per cent, and 0.02 per cent respectively, while the NGX ASeM and NGX Growth Indices closed flat.
A total turnover of 866.544 million shares worth N12.257 billion in 17,291 deals were traded last week by investors on the floor of the exchange, in contrast to a total of 1.610 billion shares valued at N12.586 billion that exchanged hands penultimate week in 18,622 deals.
Commenting on the performance of the market, Cordros Capital, in an emailed note, said, they expected the bulls to regain dominance in the market given the moderation in the prices of bellwether stocks last week amid the declining yields in the fixed income market.
“However, we do not rule out the possibility of continued profit-taking activities. As a result, we think the choppy trading pattern that played out this week will persist in the week ahead. Overall, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings”, they said.
However, Afrinvest, disagrees as they told Daily Sun that, as the market resumes today, they expect market performance to be driven by a mix of profit-taking and bargain hunting activities throughout the trading week.
Trading in the top three equities namely Honeywell Flour Mill Plc, Transnational Corporation of Nigeria Plc and Guaranty Trust Holding Company Plc (measured by volume) accounted for 203.753 million shares worth N1.964 billion in 2,515 deals, contributing 23.51 and 16.02 per cent to the total equity turnover volume and value respectively.