Equities Market Rises 2.5% as Investors Swoop on MSCI Listed Stocks

WEEKLY REPORT

By Goddy Egene and Eromosele Abiodun

Despite closing in the red in two of the four days trading, the Nigerian equities market maintained its positive run last week to close the week in the green.

The performance was boosted by the announcement that the MSCI will retain Nigeria in its benchmark frontier market index.

Also, some quoted companies released better-than-expected first quarter results, a development, which excited the market.

Notably, Nestle Nigeria Plc released its first quarter result showing improved performance, result analysts termed, “resilience in turbulent times.”

At the close of trades, the NSE All-Share Index and market capitalisation appreciated by 2.55 per cent to close the week at 25,701.60 and N8.841 trillion respectively.

Similarly, all other Indices finished higher during the week, with the exception of the NSE Insurance Index, that declined by 0.78 per cent.

It was a four-day trading week as the Federal Government of Nigeria (FGN) declared Monday   May 2, 2016 as public holiday to mark the 2016 Workers’ Day Celebration.

The previous week, the market had recorded an excellent performance that was boosted by renewed optimism by investors on the back of encouraging first quarter results after the turmoil that trailed the 2015 results.

As expected, results released the previous week showed massive improvement despite recent economic crunch fuelling speculations that the days ahead may be rosy for investors.

Daily Performance Summary

Trading had last Monday commenced on a positive note as the equities market rose by 3.20 per cent (the largest single day gain so far in 2016) driven by increased investor appetite for stocks listed in the MSCI frontier index. Consequently, the NSE ASI ended the session at 25,865.50 points, corresponding to a market capitalisation of N8.89trillion. Gains in Dangote Cement Plc, Nestle Nigeria Plc and Nigerian Breweries Plc, cancelled out bearish sentiments in Forte Oil Plc, FBN Holdings Plc and Fidelity Bank Plc. In spite of the uptrend in index, market turnover remained unchanged at N1.5 billion compared to previous session while volume of trade declined  by four per cent. Access Bank Plc and FCMB Group were the most traded stocks with 47million and 27million units each.

Profit-taking on recent gains dragged the NSE-ASI index to a negative close on Tuesday, shedding 0.58 per cent, to reverse the positive momentum.  Dangote Cement Plc, ETI Plc, and Forte Oil Plc were largely responsible for this outcome, offsetting positive sentiment in Lafarge Africa Plc, Unilever Nigeria Plc and UBN Plc. Similarly, sub-sector indices trended southward reflecting the bearish sentiment in the market. Banking trackers shed one per cent, followed by Oil and Gas (0.59 per cent) and Consumer Goods (0.21 per cent). Market turnover, however, strengthened by 50 per cent closing the session at N2.26 billion same as volume of trade which spiked by 50 per cent to berth at 331million units. Bulk of trade witnessed in the day’s session came in through FBN Holdings Plc and UBA Plc with trade of about 117 million and 33 million units respectively. Tiger Branded Consumer Plc (10 per cent) topped the gainers’ chart made of 26 stocks versus 20 losers led by Berger Paints (8.08 per cent).

The market closed on a negative note on Wednesday as investors further booked profit on recent gains. The ASI shed 0.59 per cent ending the session at 25,563.78 points, corresponding to a market capitalisation of N8.7 trillion. The outcome was driven by bearish sentiments towards Nigerian Breweries Plc, Dangote Cement Plc and Lafarge Africa Plc, offsetting gains in Forte Oil Plc, Nestle Nigeria Plc and Guaranty Trust Bank Plc. Investors staked N1.48 billion on over 178 million units of shares exchanged in 3,786 deals. This represents a 34 per cent and 46 per cent decline in value and volume of trade respectively relative to previous session. There are 25 gainers led by Fidelity Bank Plc (6.67 per cent) versus 24 losers led by Trans Nationwide Express Plc (8.85 per cent). As such, market breadth index closed positive. Performance of sub sector was mixed as gains in Oil and Gas tracker (1.63 per cent), banking (0.31 per cent) were countered by losses in Consumer Goods (2.03 per cent) and Industrial (1.12 per cent).

After two consecutive days of bearish run, investors’ sentiment turned positive on Friday lifting the ASI by 0.54 per cent. The benchmark index ended the session at 25,701.60 points, corresponding to a market capitalisation of N8.8 trillion. Increased investor appetite for the stocks of Forte Oil Plc, Tiger Branded Consumer Plc and Flour Mills Nigeria Plc drove the index to a positive close, cancelling out bearish trends in AXA Mansard Plc, Portland Paints Plc and Caverton Plc. All major sub-sector indices closed positive. Banking tracker was up 0.85 per cent driven by gains in Guaranty Trust Bank Plc (2.10 per cent ) and Zenith Bank Plc (1.15 per cent), followed by Oil and Gas index, which returned 0.82 per cent via support from 10.25 per cent gain in Forte Oil Plc. Consumer tracker (0.16 per cent) also closed positive while industrial tracker was flat. However, market turnover declined by 21 per cent ending the session at N1.17billion while volume of trade was up by a marginal one per cent closing at about 181 million units. FBN Holdings Plc and Transcorp Plc accounted for the largest portion of trade with over 30 million and 20 million units respectively.

Market Turnover

Investors traded  910.659 million shares worth N6.409 billion in 15,023 deals last week company with  a total of 1.210 billion shares valued at N7.115 billion that exchanged hands the previous week in 15,973 deals.

The Financial Services Industry dominated the activity chart with 757.354 million shares valued at N3.180 billion traded in 8,853 deals; thus contributing 83.17 per cent and 49.62 per cent to the total equity turnover volume and value respectively.

The Consumer Goods Industry followed with 46.972 million shares worth N2.263 billion in 2,636 deals. The third place was occupied by the Conglomerates Industry with a turnover of 40.009 million shares worth N69.233 million in 498 deals.

FBN Holdings Plc, United Bank for Africa Plc and Fidelity Bank Plc accounted for 359.455 million shares worth N1.086 billion in 2,797 deals, contributing 39.47 per cent and 16.94 per cent to the total equity turnover volume and value respectively.

Also traded during the week were a total of 6,837 units of Exchange Traded Products (ETPs) valued at N16.316 million executed in 25 deals, compared with a total of 12,490 units valued at N503,694.85 transacted the previous week in 28 deals.

A total of 40 equities appreciated in price during the week, higher than 33 equities of the previous week. Twenty-five equities depreciated in price, lower than 35 equities of the previous week, while 124 equities remained unchanged higher than 121 equities of the previous week.

Gainers and Losers

Meanwhile, the price movement chart of the NSE displayed a total of 33 equities that appreciated in price during the week, lower than 35 equities of the previous week. Thirty-five equities depreciated in price, higher than 32 equities of the previous week, while 121 equities remained unchanged lower than 122 equities of the previous week.

The top 10 gainers were:  Nestle Nigeria Plc Plc (N74.74), Flour Mills of Nigeria Plc (N1.34), Tiger Branded Consumer Plc, Cadbury Nigeria Plc (96 kobo apiece) and, Eterna Plc (40 kobo), UACN Prop (35 kobo),  Airline Services and Logistics Plc, Union Bank Plc (30 kobo each),  Sterling Bank Plc (23 kobo) and Neimeth Plc (nine kobo)

Conversely, the top 10 losers were: Glaxo Smithkline Plc (N1.12), NASCON Allied Plc (53 kobo), CCNN Plc (46 kobo),  Portland Paints Plc (23 kobo), AXA Mansard Insurance  Plc, Fidson Plc (11 kobo apiece), Trans Nationwide Plc (10 kobo), Union Homes Plc (18 kobo), Caverton Plc (eight kobo) and Honeywell (six kobo).