Stock Market Rebounds on Positive Q1 Results

WEEKLY REPORT

By Goddy Egene and Eromosele Abiodun

Investors in the Nigerian equities market heaved a sigh of relief last week as the market recorded a marginal gain to close the week in the green. The market had declined by 2.40 the previous week. However, the market witnessed a rebound last week with the Nigerian Stock Exchange (NSE) All-Share Index rising by 0.53 per cent to close at 24,850.11.

The positive performance, despite the overall bleak short term outlook, was driven by  bargain hunting and  first quarter corporate results.

True to investors’ and traders’ expectation, some results released last week showed massive improvement despite recent economic crunch fuelling speculations that the days ahead may be rosy for investors.

At the close of  the market,  NSE All-Share Index and market capitalisation appreciated by 0.53 per cent to close the week at 24,850.11 and N8.548 trillion  in that order.

However, it was mixed performance in terms of sectoral performance. The NSE Consumer Goods Index, NSE Oil/Gas Index and The NSE Lotus Index  declined by 0.83 per cent, 0.73 per cent and 0.77 per cent respectively. On the other hand, the NSE Banking Index rose by 3.82 per cent and the NSE Insurance Index appreciated by 2.6 per cent.

Daily Performance Summary

Monday’s trading session had commenced on a shaky note as activities were hindered by a technical glitch, which affected the market between 10.29 a.m and 2.20 p.m. The market reopened at 2.20 p.m and closed at 4p.m. Consequently, the NSE ASI closed 0.28 per cent lower for the day at  24,650.92 points corresponding to a market capitalisation of N8.48 trillion. All major sectors closed in the red with the Oil and Gas sector the biggest loser, shedding 0.84 per cent due to sell offs in Conoil Plc (9.37 per cent) and Oando Plc (8.33 per cent). Consumer goods declined 0.64 per cent due to Nigerian Breweries Plc (1.42 per cent) and Guinness Nigeria Plc (0.41 per cent) while Banking fell 0.60 per cent as Fidelity Bank Plc (4.84 per cent), Access Bank Plc (1.90 per cent), Zenith Bank Plc (1.31 per cent), FBN Holdings Plc (0.90 per cent) and Guaranty Trust Bank Plc (0.13 per cent) closed negative. Market activity fell significantly on the day, which may not be unconnected to the shorter than normal trading session.

The market rose 0.13 per cent on Tuesday to close at 24,659.17 points driven by the banking sector which gained 2.04 per cent. The sectors performance was driven by Guaranty Trust Bank Plc (2.28 per cent), UBA Plc (3.12 per cent), Zenith Bank Plc (1.95 per cent) and FBN Holdings Plc (1.21 per cent). All other sectors closed in the red with Consumer goods shedding 0.91 per cent as Nigerian Breweries Plc (1.91 per cent) and PZ Cussons Plc (4.10 per cent) amongst others declined. The Oil and Gas and Industrial sectors fell 0.14 per cent and 0.04 per cent respectively. Market activity improved on the day as total volume was up 76.5 per cent to 229 million units of shares while total value jumped 147 per cent to N1.44 billion. Guaranty Trust Bank Plc accounted for 32 per cent of the day’s total value.

The sustained positive appetite for equity investment pushed the NSE ASI higher on Wednesday. The NSE ASI appreciated further by 0.51 per cent to close at 24,784.95 points, compared with the gain of 0.13 per cent recorded the prior day. The appreciation recorded in the share prices of Guaranty Trust Bank Plc, Zenith Bank Plc, Dangote Sugar Plc, Oando Plc and Access Bank Plc were mainly responsible for the gain recorded in the Index. Similarly, the market capitalization appreciated by 0.51 per cent to close at N8.53 trillion, compared with the appreciation of 0.13 per cent recorded yesterday to close at N8.48 trillion. The total value of stocks traded on the floors of the NSE on Wednesday was N1.11 billion, down by 22.76 per cent from N1.44 billion recorded the previous day.

The bulls maintained their hold on Thursday, leading to a further appreciation in the equity market.  The ASI appreciated by 0.50 per cent to close at 24,909.88 on gains posted by Zenith Bank Plc, Nigerian Breweries Plc, UBA Plc, Access Bank Plc and Oando Plc. Similarly, the market capitalisation appreciated by 0.50 per cent to close at N8.57 trillion. The total value of stocks traded on the floors of the NSE on the day was N1.18 billion, up by 6.13 per cent from N1.11 billion recorded the previous day.

However, profit taking by some  investors depressed the equity market on Friday as the NSE ASI depreciated by 0.24 per cent. The depreciation recorded in the share prices of UBA Plc, FBN Holdings Plc, Nestle Nigeria Plc, Access Bank Plc and Oando Plc were mainly responsible for the loss recorded in the index.

Market Turnover

During the week under review, a turnover of 885.367 million shares worth N5.829 billion in 13,870 deals were traded by investors on the floor of the exchange in contrast to a total of 8.054 billion shares valued at N13.328 billion that exchanged hands the previous week in 15,212 deals.

The Financial Services Industry remain the most active leading the activity chart with 747.817 million shares valued at N3.832 billion traded in 8,768 deals; thus contributing 84.46 per cent and 65.73 per cent to the total equity turnover volume and value respectively.

The Consumer Goods Industry followed with 45.517 million shares worth N977.579 million in 2,145 deals. The third place was occupied by the Agriculture Industry with a turnover of 32.313 million shares worth N48.460 million in 247 deals.

Transactions in  Zenith International Bank Plc, Guaranty Trust Bank Plc and United Bank For Africa Plc accounted for 290.319 million shares worth N3.015 billion in 3,795 deals, contributing 32.79 per cent and 51.72 per cent to the total equity turnover volume and value respectively.

Also traded during the week were a total of 4,511 units of Exchange Traded Products (ETPs) valued at N1.401 million executed in 38 deals, compared with a total of 690 units valued at N572,158.80 transacted the prior week in 28 deals.

A total of 3,241 units of Federal Government and Corporate Bonds valued at N3.579 million were traded in 4 deals compared to a total of 28,280 units of Federal and State Government Bonds valued at N29.572 million transacted the previous week in 8 deals.

Gainers and Losers

Meanwhile, a look at the  price movement chart showed that  a total of 35 equities appreciated in price during the week, higher than 26 equities of the previous week. Conversely, 32 equities depreciated in price, lower than 41 equities of the previous week, while 122 equities remained unchanged same as the previous week. The top 10 gainers were:  Berger Paints (78 kobo); Dangote Sugar (52 kobo); Tiger Branded Consumer Plc (48 kobo); UACN Properties Plc (45 kobo);  Eterna Plc (33 kobo); Axamansard Insurance (21 kobo); Trans Nationwide Express Plc (14 kobo); FCMB Group Plc, Diamond Bank Plc (11  each kobo) Learn Africa Plc (nine  kobo);.

On the contrary, the top 10 losers were: Okomu Oil Plc (N3.00), Conoil Plc (N1.70), Union Homes Plc (41 kobo); Champion Breweries Plc (29 kobo), Portland Paints Plc (26 kobo)  Law Union & Rock Plc; Fidelity Bank Plc, Airline Service  and Logistics Plc (19  apiece kobo); Cutix (12 kobo) John Holt Plc (eight  kobo).