Investors’ Interest in BUA Cement, Others Lift Stock Market by N236bn

Kayode Tokede

Transactions on the floor of the Nigerian Exchange Limited (NGX) remained positive for the fifth consecutive week as average investors’ investment in the stocks added N236 billion at the close of trading last week.

The positive performance was driven by gains recorded by BUA Cement, Zenith Bank, Wapco, Fidelity Bank, FBN Holdings, Stanbic and as such, the All Share Index (ASI) notched a 0.98 per cent gain, closing the week at 49,316.29 basis points.

This caused the market’s Month-to-Date (MTD) and Year-to-Date (YTD) returns to increase to +3.5 per cent and +15.5 per cent, respectively.

Consequently, market capitalization closed at N26.861 trillion from an opening value of N26.625 trillion, representing an increase of N236 billion in five trading sessions on the bourse.

Across sectors, the Banking Index added per cent 2.8 per cent, Industrial Goods Index  rose by 3.4 per cent, Insurance Index gained 0.5 per cent and Oil and Gas  Index appreciated by 0.4 per cent, while the Consumer Goods Index dropped by 0.2 per cent, the sole loser for the week.

However, activity levels were lower this week as trading volume and value decreased by 34.1 per cent and 20.7 per cent week-on-week (w/w), respectively.

A total turnover of 814.089 million shares worth N12.204 billion in 15,488 deals was traded by investors on the floor of the exchange, in contrast to a total of 1.225 billion shares valued at N15.243 billion that exchanged hands last week in 15,317 deals.

According to the NGX’s market data, the Financial Services Industry (measured by volume) led the activity chart with 663.799 million shares valued at N5.517 billion traded in 7,240 deals; thus contributing 81.54 per cent and 45.21 per cent to the total equity turnover volume and value respectively.

The ICT industry followed with 44.358 million shares worth N4.493 billion in 1,136 deals while the Consumer Goods industry recorded a turnover of 27.372 million shares worth N1.187 billion in 3,051 deals.

Trading in the top three equities namely Sterling Bank Plc, Access Holdings Plc and Guaranty Trust Holding Company Plc (measured by volume) accounted for 394.878 million shares worth N2.847 billion in 2,274 deals, contributing 48.51 per cent and 23.33 per cent to the total  equity turnover volume and value respectively.

Commenting on the performance of the market, market operators said that in the short term, they still see scope for expansion in valuation multiples, as positioning by early birds in dividend-paying stocks ahead of 2022 dividend declarations should outweigh profit-taking activities.

“Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings”, Cordros Research said.

On their part, analysts at Afrinvest said, “This week, we anticipate a modest sell-off as investors begin to re-align portfolios ahead of the new year”.