The week on the Nigerian Stock Exchange recorded another straight 4 days of gains, continuing from where it left off last week. The first four trading sessions in the week, all ended on the positive side, as Investors soaked up lowly priced Market bellwethers.
The last trading session this Friday put a stop to the trend, with the Market Index reverting to the negative side, as Investors seemingly booked profits made in the 9 straight days of gains.
Year to Date, the overall trajectory of the market index is still in a declining trend. Although many of the fundamentally strong stocks listed on the exchange has risen from the low prices they were trading in March.
Fig 1: NSE ASI YTD Trend vs Activity Level Trend
Despite the trend of the Nigerian Stock Exchange All-Share Index, there still exists attractive stocks in the market.
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A total turnover of 1.662 billion shares worth N18.205 billion in 28,791 deals were traded in the week in review by investors on the floor of the Exchange, in contrast to a total of 1.012 billion shares valued at N9.892 billion that exchanged hands in 17,023 deals in the preceding week.
This represents a tremendous improvement in the activity level, as the volume and value of shares traded week on week went up by 65% and 84% respectively.
The Financial Services industry (measured by volume) as always led the activity chart with 1.385 billion shares valued at N11.813 billion traded in 17,117 deals; thus contributing 83.35% and 64.89% to the total equity turnover volume and value respectively.
Trading in the Top Three Equities namely, FBN Holdings Plc, Guaranty Trust Bank Plc and Zenith Bank Plc. (measured by volume) accounted for 774.294 million shares worth N9.796 billion in 7,516 deals, contributing 46.59% and 53.81% to the total equity turnover volume and value respectively.
The NSE All-Share Index (ASI): An index is an imaginary portfolio of securities representing a particular market or a proportion of the market.
Weekly performance %: 4.45
MTD Performance %: 4.45
QTD Performance %: 12.89
YTD Performance %: (10.42)
NSE Insurance Index:
Weekly performance %: 2.76
MTD Performance %: 2.76
QTD Performance %: 4.89
YTD Performance %: (0.46)
NSE Oil & Gas Index:
Weekly performance %: 2.83
MTD Performance %: 2.83
QTD Performance %: (0.10)
YTD Performance %: (18.09)
NSE Banking Index:
Weekly performance %: 3.99
MTD Performance %: 3.99
QTD Performance %: 19.74
YTD Performance %: (20.89)
NSE Consumer Goods Index:
Weekly performance %: 8.45
MTD Performance %: 8.45
QTD Performance %: 23.65
YTD Performance %: (32.11)
NSE Industrial Goods Index:
Weekly performance %: 2.20
MTD Performance %: 2.20
QTD Performance %: (0.52)
YTD Performance %: (3.79)
In all, 39 equities appreciated in price during the week in review, higher than 28 equities in the preceding week. 22 equities depreciated in price, lower than 20 equities in the preceding week, while 102 equities remained unchanged, higher than 115 equities recorded in the preceding week.
The price of Oil continued to rise, bringing a much-needed reprieve to the Nigeria Economy. At the time of this report the benchmark Brent was trading above US$30.00. This could have contributed to improved activity of Investors, snapping up the lowly priced stocks, thereby pushing the index higher.
The Minister of Finance, Zainab Ahmed hinted in the week that the Federal Government will consider revising the 2020 benchmark from oil again to US$20.00.
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The macro-economic indicators are still unfavourable in our view, and for that reason we maintain our negative outlook to the market. However, the addition of fundamentally strong stocks that trade below their fair values to an Investor’s portfolio will turn out to be profitable in the long term. Those companies can withstand the turbulence and return value for the money invested.